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Posted by removeps-groups@yahoo.com on March 14, 2008, 1:27 pm
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> I sold a chunk of mutual funds at a loss, but due to automatic
> dividend reinvestment of the shares I still hold, I believe I have
> what you call a partial wash sale.
> It shows:
>
> Cost basis: $1525
> Wash sale disallowed loss: $10
>
> Can I just enter this as a costs basis of $1515?
>
> Or do I have to enter 2 separate sales, and if so, what numbers do I
> put in?
If you sold all of the mutual fund and didn't buy back any of the
mutual fund 30 days after you sold all of it, then report the cost
basis as $1,525 and don't worry about the wash rule.
What your statement seems to be saying is that you got a dividend of
$10 less than 30 days before you sold your fund, and you bought shares
with it. Say before the dividend you had X shares, but after had X+Y
shares. If you sold only X shares, then you do have to worry about
the wash rule, and $10 of the loss would be disallowed, but carried
forward to the time you sold the Y shares. Second scenario: If you
sold X+Y shares, but bought the mutual back within 30 days, or you
bought the same mutual fund in a different account within 30 days
before or after the sale, then the wash sale rule also applies, but
the determining factor is the amount of shares you bought in the 2nd
trade that was within 30 days of the date you sold X+Y.
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