wash sale?

[mollyanna58]

I sold stock at a loss on 8/21/13.  I had owned these shares for a couple of years.  I misread something when I looked at my account and thought it had recovered and that I would have a small gain.

I had also bought and sold the shares in the same company a couple of times for short term gains in July and August 2013.   These short term gains were made at a different brokerage. 

Would the loss be considered a wash sale?

Thanks!

[mwcpa]

Yes, the loss is a wash sale... but....

The loss that is "lost" is not really "lost" it is deferred....

Example....

I own a 100 shares of XYZ with a cost of 1,000. I sell it for 750. I "lost" 250.

10 days later, in a different account (any account I own, including an IRA) I buy 100 shares of XYZ at 500.

The loss on the sale is not allowed as a wash loss.

The suspended loss of 250 is added to my basis in later purchase, so the basis is 500 +250 = 750.

when I sell those shares I can use 750 as my basis.

Make sense?

[mollyanna58]

Thanks for the answer.

Yes, I knew that the loss on a wash sale got added to the basis of the later purchase.  So I have to adjust what was downloaded into Turbo Tax by the second brokerage.