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Understanding Wash Sales Rules And Reporting To The IRS

When it comes to trading securities, the IRS has some very specific rules. Some of them should be obvious to people, and others are more complicated. Investors should know that the IRS will closely monitor their wash sales. Some may be unfamiliar with this term. These are transactions in which investors get rid of a particular security and show a loss on it. Then they turn around and repurchase the same security, or one like it, within 30 days of the first sale.