pdx5, if you do as you say, you'll need to be careful not to violate the wash sale rule or you'll be in big trouble with the IRS if you claim that loss on your tax return. You can't claim a loss on your tax return if you buy a stock you sell at a loss within a 61 day window surrounding your loss sale. You also have to be careful to not have long call or short put transactions for that stock as well during that window.
I thought the wash sale rule was 30 days. May have been extended to 61 days, IDK.
I have not done tax loss selling for decades. But have done it in the past, and I seldom buy back what I sold off.
On another note, IRS computer programs are probably not savvy enough to catch your trade from 2022 matched with your sale in the same stock a few years later. To do that the program would have to search all your past returns and match with the current transactions. It is upto each individual to follow the rules. If IRS audits your return, a sharp agent could discover violation of 61 day rule, however.
Also, violating 61 day rule is no where as serious as omitting capital gains or dividends & interest on your return. IRS will just send you a bill for the tax owed plus interest. Very little chance you will be wearing orange suit.
I am assuming people who wanted to execute a tax loss sale will not wait until the last day of trading.
Therefore the last 2 days left to trade in 2022 are probably not going to be affected by tax loss selling.
Edited by pdx5, 28 December 2022 - 07:01 PM.
"Money cannot consistently be made trading every day or every week during the year." ~ Jesse Livermore Trading Rule