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This is a hypothetical question that could come up. This situation almost happened to me. Suppose I own stock in company A and sell it for a loss and buy company B. Within the next 30 days Company A and B announce a merger and shares of company B stock will be converted to company A stock. My question is: Does the Wash Rule apply here?

I am pretty sure that the wash rule would apply if I sold company A for a loss after the merger is announced and bought company B and the loss would not be deductable. I imagine that the rule would not apply if I sold A and bought B before the merger is announced, but I want to check to be sure.


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