Question

Christina, who is single, purchased 300 shares of Apple Inc. stock several years ago for $15,600. During her year-end tax planning, she decided to sell 150 shares of Apple for $7,050 on December 30. However, two weeks later, Apple introduced its latest iPhone, and she decided that she should buy the 150 shares (cost of $7,350) of Apple back before prices skyrocket. Leave no answers blank. Enter zero if applicable.)

b. Assume the same facts, except that Christina repurchased only 75 shares for $3,675. What is Christina’s deductible loss on the sale of 150 shares? What is her basis in the 75 new shares?

Answer 1

Note : Loss for Christina (sell of150 shares of Apple) = $7,050 - [$15,600 * 0.50] = $750

Answer b.

Since Christina repurchased 75 shares of identical stock of Apple Inc within 30 days of selling the 150 shares shares.. Thus as per wash sales rules , she is eligible to deduct [($750 / 150 shares) * 75 shares] = $375

Christina’s deductible loss on the sale of 150 shares = $375

Christina’s basis in the 75 new shares = Purchase cost of 75 shares + Disallowerd loss on sale of 150 shares

=  $3,675 + ($750 - $375) = $4,050