Whats the IRSs “wash sale” rule?
— N.W., Goshen, Ind. A: Under the IRS’s “wash sale” rule, if you sell a stock for a loss and buy it back within 30 days, the loss cannot be claimed for tax purposes. Don’t worry, though — the loss isn’t lost forever. You do get to claim it, just not now. The disallowed loss is added to the cost of the repurchased stock, and it’s claimed when the stock is finally sold in a non-wash-sale way. It’s often best to simply avoid the rules entirely, though, by always waiting 31 days before jumping back into any stock. Learn more about the wash sale rule and other tax issues for free at www.fool.com/taxes, and from the horse’s mouth, at www.irs.gov. Fool’s School Prices: The Big Picture Do you ever look at a stock’s price and think, “Ten dollars per share — that looks like a cheap price”? Or, “No, a $75 stock is too expensive for me”? If so, snap out of it! Two stocks trading at similar prices do not necessarily represent similar values. For example, consider Clorox and Procter & Gamble. At
