Actually, two questions: I sold short a stock on December 31st 2002, and bought it back on January 1st, 2003. Do I include the loss or gain in my 2002 tax. I think yes, because the sale was made on December 31, but then let's say that I buy back the stock not on January 1st, but after I file my return, for example on March 30st, 2003. What do I do in this case? The second question is about wash sale. Let's say I bought a stock on June 1st, 2002, and I sold it for a profit on June 10th, 2003. On June 15th, 2002 I bought the same stock again, and sold it for a loss on June 20th, 2002. After that I never touch that stock for at least 31 days. Is the second trade a wash sale, and if yes, is the first trade the one that gets the carryover from the second trade? Thanks for your help!