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Author: mikeraz Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121585  
Subject: ROTH and WASH reporting Date: 12/11/1998 5:55 PM
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I was ready to sell a position (IP) in my taxable account at a loss for the tax benefit.

The I looked and saw that IP would be a selection for the RP4 portion of my ROTH IRA portfolio.

How do I report the IP sale on my tax return? I will certainly be in a wash sale position.
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Author: TMFTaxes Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 7122 of 121585
Subject: Re: ROTH and WASH reporting Date: 12/14/1998 10:49 AM
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[[I was ready to sell a position (IP) in my taxable account at a loss for the tax benefit.

The I looked and saw that IP would be a selection for the RP4 portion of my ROTH IRA
portfolio.

How do I report the IP sale on my tax return? I will certainly be in a wash sale position.]]

In my opinion, you DO have a wash sale...even though the purchase will be in a "different" account. Other professionals may differ in this opinion, but based upon my research I believe that I'm on pretty solid ground.

As far as reporting, that's a problem. In theory, you would have to adjust the basis of your IP in your IRA account, and you would NEVER receive the benefit of the loss in your taxable account. A real problem.

What to do? Since you have already messed up your portfolio with this transaction, you may consider buying the IP in your taxable account, keeping the wash sale in your taxable account, and eventually recognizing the loss in your taxable account.

Remember that the wash sale rules don't apply in your IRA account, since losses aren't recognized. So if you have wash sale problems, keep 'em in the IRA account...and keep 'em away from your taxable account.

You've still got time to make the appropriate correction. Don't dawdle.

TMF Taxes
Roy

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Author: mikeraz Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 7125 of 121585
Subject: Re: ROTH and WASH reporting Date: 12/14/1998 11:29 AM
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Thank you for the opinion.

I had not sold the IP yet. So nothing is messed up at this point. Since there is reasonable ground for classifying it as a wash sale I'll just leave the IP in my taxable account.

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Author: TMFTaxes Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 7209 of 121585
Subject: Re: ROTH and WASH reporting Date: 12/15/1998 9:43 AM
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[[I had not sold the IP yet. So nothing is messed up at this point. Since there is reasonable ground
for classifying it as a wash sale I'll just leave the IP in my taxable account.]]

Great, Mike...

Since nothing was done yet...nothing has to be "fixed". That is certainly good news!!!

TMF Taxes
Roy

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