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dderricckk writes (in part):

Here's my "bright idea": I "move" the stock into my IRA by selling it in my regular account, and immediately buying the same number of shares in my IRA. I get to use the $1000 loss in my regular account to offset other gains, and whatever it gains over $40 is tax deferred in my IRA.

Too good to be true, but I'll ask anyway. Is this a wash sale? If so, that just means that if I do this, I can't take the loss, right? Would it make a difference if I bought the new shares of XYZ in the IRA *before* selling them in my regular account?

I reply:

There's been no definitive ruling, but many people think that there's a significant risk this would be a wash sale. The effect would be to prevent you from offsetting the loss against your capital gains, or deducting it from ordinary income. Buying the new shares first will not help unless you buy them more than 30 days before your sale; the wash sale rule is written to guard against precisely the strategy you suggest. --Bob
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