0

I'm in a situation where I have a tranche of company RSUs vesting on the 1st of every month. For simplicity, here's what my scenario looks like:

May

  • Acquired 1000 shares on the 1st at $10/share. 400 shares were automatically sold at the same price to cover taxes.
  • Sold the remaining 600 shares at $9/share on the 3rd, at a net loss of -$600.

June

  • Acquired 100 shares on the 1st at $8/share. 40 shares were automatically sold at the same price to cover taxes.
  • Remaining 60 shares available for sale.

July

  • Acquired 100 shares on the 1st at $9/share. 40 shares were automatically sold at the same price to cover taxes.
  • Remaining 60 shares available for sale.

... and so on, for the next 3 years.


I believe this monthly cadence of RSU vesting causes me trigger "wash sale rule" and I cannot claim the -$600 in losses from May. If I get lucky somehow, I could possibly sell all remaining on the 1st of a month that has 31 days, but even this is tricky because

a) it typically takes 1-2 business days for the remaining shares (after taxes) to be deposited in the account and be eligible for sale and b) there are long blackout periods to prevent insider trading.

Is there any recourse for me to claim the losses this year or will it keep getting added to the basis and I can claim it only after 3 years (when my monthly cadence runs out)?

1

You are not going to sell every month with a loss (otherwise, you should change your strategy, maybe). The wash sale losses reduce future gain, but sooner or later, you will sell with a gain, and the taxable gain will be smaller (by the amount of the wash sale losses).

Alternatively, you could just wait 31 days instead of 30, and be outside of the wash sale window.

  • The key part that I think complicates this is that 1) I am "acquiring" identical shares each month and 2) the brokerage automatically sells each month to pay for taxes so there is simultaneously a sale being triggered as well. – rsu holder Jul 6 at 0:24
  • Or, is it the case that in June, a portion of the -$600 loss from May (based on 600 shares) would be added to the basis for 60 shares in June ($60). Thus -$60 of the losses are disallowed, but I can claim -$540 as losses? – rsu holder Jul 6 at 0:29

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.