As Meme Stocks Make A Comeback, Beware This Tax Trap
News Source : Forbes
News Summary
- A 50-something investor tried his hand as a day-trader, rapidly buying and selling stocks such as AMC Entertainment.
- He racked up more than $7 million in gains and just a hair over that in losses, resulting in what he thought was, more or less, a wash.
- But it wasn't a wash, because of the too-often neglected “wash sale’ rule, which holds that you can’t claim tax losses on a stock that you sell at a loss.
Heavy traders may assume theyll owe no capital gains tax if their losses and gains even out. But then they stumble across the wash sale rule.At the height of the pandemic born meme stock boom in 20 [+12495 chars]
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