Question

Malia owns 60 shares of XYZ Co., with an adjusted basis of $2,940. On February 14, 2019, she sells the 60 shares for their FMV of $2,700. On March 1, 2019, she purchases 35 shares of XYZ Co., for $1,540. What is the adjusted basis for the 35 shares purchased on March 1, 2019?

Answer 1

As per the §1091, wash sale , if shares are sold at loss from their adjusted basis and within 30 days before or after the date of sale significantly same shares are purchased then loss realized on those shares are not recognized instead its added to the basis of newly purchased shares.

So Sale price of 60 Shares = $2700

Less: Adjusted basis of shares = 2940

Realized loss = -$240

Purchase price of 35 shares = $1540

Add: Loss unrecognized on sale = 240

Adjusted basis of 35 shares = $1,780