The Motley Fool Discussion Boards

Previous Page

Financial Planning / Tax Strategies

URL:  http://boards.fool.com/ltlt-say-i-own-100-shares-of-company-d-a-12891761.aspx

Subject:  Re: Wash sale rule question and capital losses Date:  7/11/2000  5:36 PM
Author:  TMFExRO Number:  37373 of 121100

<< Say I own 100 shares of company D, a relatively undifferentiated firm with several public competitors with very similar businesses. The stocks of all these firms move pretty much in tandem. Lets say company D is down 30% from where I bought it. If I sold the shares of company D and put that money immediately into a similar competitor whose shre price is down 27%, am I in danger of running afoul of the wash sale rule? >>

No. This is not a wash sale. The fact that the two companies are in the same sector doesn't make their stocks substantially similar.

<< Second question: How much of capital losses can I claim against my ordinary income? Any? >>

If you have a net capital loss you can use $3,000 of it on that year's return. Anything more is carried forward. There's an excellent article on netting of gains and losses in the FAQ.

TMF ExRO
Phil Marti
Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us