As a follow-up to this question: Wash sale rule impact on different scenarios between different types of accounts

Do HSAs and 401k's fall under the same treatment as IRAs when computing tax losses?

For instance, your HSA and 401k are set to allocate biweekly contributions and reinvest dividends for a Fund X resulting in a total of 50 shares purchased during the 30 days before and 30 days after a sale of 100 shares of Fund X in your personal brokerage account. Does the loss in the personal brokerage account only apply for 50 shares of Fund X?


It's been documented (although, in my opinion, the linked question is awful) that a loss in a taxable acct can be "washed" by a purchase in a tax favored acct.

The answer to your question is yes, whatever the loss from shares sold is offset by up to the same number of shares purchased in the tax favored acct.

In practice, it would take a very diligent person to track this, and not claim the losses. In my own 401(k), I never really paid attention to weekly/bi-weekly purchase dates or reinvestment of dividends. On reflection, the shares purchased were always an institutional share and would not be considered identical for purpose of wash sale rules anyway.

  • Thanks. Since I'm investing in Index Funds tracking the same index in both taxable and tax-advantaged accounts, I think I'm at risk of triggering a wash. Could I offset the wash by selling shares in the tax-advantaged account? It's easier to do so than to change the investment allocation. Or would it be easier to forget about the 401k and wait to see if an audit comes?
    – Kora
    Aug 15 '18 at 15:17
  • 1
    I can't advise you to skirt the tax code, but practically speaking, I doubt even a normal audit would find this. And if it did, the recovery for the IRS would be pennies compared to going after real tax evaders. Aug 15 '18 at 15:32

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