Identifying A Wash Sale
In the USA wash sale rules are codified in "26 USC ยง 1091 - Loss from wash sales of stock or securities."
Under Section 1091, a wash sale occurs when a taxpayer sells or trades stock or securities at a loss, and within 30 days before or after the sale:
- Buys substantially identical stock or securities.
- Acquires substantially identical stock or securities in a fully taxable trade,
- Acquires a contract or option to buy substantially identical stock or securities, or
- Acquires substantially identical stock for your individual retirement account (IRA) or Roth IRA.
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