I trade almost the same stocks every day, e.g. AAPL and NVDA but I did not elect MTM(mark to market). Do I have to pause trading these stocks for the entire month of December in order to clear/avoid wash sale for the year of 2022? This article explains my reasoning. https://www.bankrate.com/investing/wash-sale-rule/
Well, if you have losses, you will have to pause at least 31 days w/r/t purchasing any security that you had the losses on if you want to take those. Not a calendar month, but any 31 day period, and only with respect to purchases, and only with respect to the securities you have the losses on your want to take where you've already not had at least 31 days lapse without any purchases. That's what I gathered from your article at least ha.
I don't know anything about US tax laws, but to me, wash sale doesn't apply to day-trading. But I'm not an expert, so I might be completely wrong.
According this article, wash sale does apply to day trading: https://centerpointsecurities.com/day-trading-rules/
Not sure cause it mentions capital loss, and profit/loss from day-trading is not considered as such (at least in Canada!). But maybe it's different in the US.
Wash sales apply to all securities. you need to not trade 30 days before or after I think. Wash sales offset in the same underlying. They don’t offset across underlyings. so if you buy and sell and lose. Then buy and sell and win, the loss is offset against the win. If you buy and sell and lose again that will be washed. For stocks it’s pretty cut and dry. Options are very tricky because moneyless impacts “substantially identical.”
Here is another good example of how to clear wash-sale losses. https://ttlc.intuit.com/community/i...-sale-rule-and-december-wash-sales/00/2423217
So much inaccurate info being dispensed in this thread!! The facts on wash-sales from the experts.... http://www.tradelogsoftware.com/resources/wash-sales/
This is a really good article. The following is quoted from this article. To verify my understanding of the wash-sale rule, in order to claim the wash-sale losses for 2022, I just need to pause trading for a period of 31 days between Dec 1 2022 and Jan 31 2023, right? PLEASE READ THIS REAL LIFE ACCOUNT: In tax year 2000, a trader repeatedly bought and sold anywhere from 400 to 1000 shares of the same stock over a period of several months and never stopped trading this particular stock for more than 30 days. Some trades were profitable, but most were not. His profitable trades amounted to $7,023. On 12/29/2000 he liquidated all of his shares and took a $117,045 loss. Therefore his net loss at year end totaled $110,022. He could have stopped right then and there, but for some reason he did not! What do you think would happen if he repurchased this same stock on January 2, 2001? You guessed it, his entire loss of $117,045 was disallowed for 2000 and he ended up having a net gain of $7,023 for tax year 2000! He had an actual net loss of $110,022 on that one stock for tax year 2000, but because of not paying attention to the IRS wash sale rule, he instead had to pay taxes on a gain of $7,023!!
Yup. IMO, the period between Thanksgiving and New Years is the perfect pause. Again, IMO. --- It leaves no questionable counting of 31 days. --- It contains several days off or shortened days that may not be suitable for trading anyway. --- It is a good time to increase knowledge of trading in general and other instruments like futures, forex, crypto, etc, etc --- Your family will appreciate you spending more time with the things in life that are really important!!!