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Scenario

7 days ago I exited from some mutual funds where I had experienced significant gains. I came across information just today that shows my 2017 tax return will be a LOT more beneficial if I don't have to realize the mutual fund gains.

Question

If I reinvest the mutual fund gains within 30 days of when they were taken out can I avoid having to report the gains for 2017?

  • If you are thinking of wash sales, then be aware that wash sales rules apply when you sell stock for a loss and then re-invest in the same security within 30 days. Here, you sold for a gain.... – Dilip Sarwate Dec 2 '17 at 4:39
  • @DilipSarwate I see. So even if I reinvest the the EXACT amount I took out (with all gains intact) there's no way to get around this.. What if I contact the broker directly with my situation? Is that unreasonable or are they capable of smoothing it out on their end? – Jacksonkr Dec 2 '17 at 16:14
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The 30 day timeframe comes from the wash sale rules. You can't sell a stock, realize a loss, and then buy the same stock back within 30 days. If you do, you can't deduct the loss.

Unfortunately, the wash sale rules only apply for losses. You can't avoid a gain by buying back the same fund.

  • Is there anything I can do to reinvest the gains without tax penalty? – Jacksonkr Dec 4 '17 at 0:02

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