How Long Do I Have To Wait To Buy A Stock After Selling It (For A Loss)? – FAQ

The simple answer: 30 Days. Per, https://www.irs.gov/publications/p550

But What Is The Full Question? And What Does 30 Calendar Days Answer?

Now that I have sold out of my Riot Platforms, Inc. (RIOT) stock, a discussion that will come up with my accountant again will be how long I have to wait till I can repurchase it. I am not a financial expert, but I like to surround myself with good people with good financial advice. Talk to your tax advisor about your tax situation.

Well, I’ve had this conversation in the past with my accountant, but it was lightly covered since, most of the time, I bought low and sold high. Unlike most financial gurus pitching their get-rich-quick programs, I share with you the truth: traders and investors suffer losses.  

I lost money with my RIOT options; after being assigned to PUT‘s I sold, the stock continued to decline. There was a point where I saw a rebound, which I averaged down, but after the rebound, I only sold off that portion I bought, trying to recoup some of my losses.  

I tried to recoup additional losses while bag-holding these stocks by selling covered calls, but RIOT never recovered. So, to finish off this tax year, I sold all my RIOT stocks.

I failed at doing the Wheel Strategy.

So, the question I need to ask:

How Long Do You Have To Wait After Selling A Stock To Buy It Again, Without Losing The Ability To Write Off Capital Losses?

30 Calendar Days.

What I’m talking about here is I’m trying to lock in capital losses to apply against any capital gains I made for this year. So, my losses cancel out my gains for my income taxes.

Thinking about money.

Can you sell a stock and buy it again on the same day?

Simply put, I know of no rule that prevents us from moving into and out of stock on the same day.

So, the answer appears to be a simple Yes. But again, if you are hoping to claim a capital gain loss, you might want to meet the IRS requirements to write off a capital gains loss.

FYI: There are Pattern Day Trader(PDT) concerns. However, if you are moving into and out of stock frequently, you should meet all the requirements to avoid any PDT restrictions.

Is It Right To Sell A Stock For A Profit But Buy It Back Immediately?

I’ve done this before and found no rules against it, and it is void of PDT concerns.

I’ve seen stock become over-bought, driving up the price, which resulted in me wanting to take a profit. Later, the hype died off; others must have taken profits as well, and the price dropped.

I liked the stock, so I re-bought it back at a lower price and held till the next chance to make a profit. Stocks can be over-sold and over-bought, which can allow for a quick profit, with a quick turnaround re-buying the stock.

But back to the question, I read nothing preventing you from selling a stock, or security, for a profit and then re-buying on the same day. The IRS rules I read were about taking losses as a tax deduction.

What Is The 30-Day Stock Loss Rule?

You can read more about this topic in the IRS Publication 550 under “Wash Sales.” https://www.irs.gov/publications/p550

Tom, Growing His Passive Income Generators.
Myself with an interesting Bull Sculpture.
Notice: No Lambo’s. :/
Hi I’m Tom, A Blogger And A PIG Farmer.

PIG Farmer as in I grow Passive Income Generators(PIG’s).

I’ve been playing with stocks, mutual funds, and options for decades, as well as always working on my side hustle stacks.

Unlike what you read online, I’ve yet to find a way to get rich quickly. Get Rich Quick isn’t happening for me.

My journey has been long and continues. I hope to have so many PIGs I can stop working at my current job and volunteer as a medical worker overseas. 

Still waiting, but getting there. I still am a family man, and while on this Journey of Growing PIGs.  

I wanted to share my adventures(ups and downs), hoping you will contribute with your feedback and comments.

Fun Fact: In my spare time, I am a Band-Dad!

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