If you sold stock or mutual fund shares for a loss and then bought back the same stock or or fund shares within 30 days, this is a called a wash sale. The tax law does not allow you to write off a loss in a wash sale.
It does not matter whether you buy the replacement stock or securities before or after you sell. Please note that agreeing to buy the security, or purchasing an option to buy the security, counts as if you bought the security.
Although your loss is disallowed, you still have to report the sale. To do so, enter the sale on the Capital Gains and Losses Worksheet as if it were a regular sale. Then, enter another transaction immediately after the wash sale, using the following information (as long as you indicate in the checkbox that the sale is a wash sale, TaxCut will automatically fill in the dates described in the second line below):
All is not lost on a wash sale. The loss on the deal is really postponed rather than forfeited. You add the disallowed loss to the basis of the replacement shares you bought. That means the tax benefit of the loss will be resurrected when you sell those shares—resulting in either a tax-saving loss or a small taxable profit.
The 30 day wait rule doesn't apply when you sell for a taxable profit. In that case, you can buy back the identical shares at any time and, of course, you still have to report the profit on your tax return.