Wash Sales

Discussion in 'Professional Trading' started by Swish, Sep 27, 2003.

  1. Swish

    Swish

    Does anybody know why the wash sale rule exists w/ the IRS?? What is it trying to prevent or what loophole was it trying to close?

    Only thing I could think of was might have been instituted long time ago to discourage manipulation of stock price through indirect volume inflation.......

    Swish
     
  2. stevebec

    stevebec

    It keeps you from selling the stock at a loss to get the tax writeoff and then buying it right back to keep your position effectively the same.