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Wash Sale
Wash sale is an illegal attempt to create false impression of trading activity in order to try to achieve tax loss.
When investor buys and sells the same security through two different brokers, he tries to create impression of a loss. This strategy is an illegal attempt to lower the tax burden, which is spotted by the IRS, who implemented 30-day wash rule.30-day wash rule demands from investor to hold the security for 30 days after buying it, or to stay away from the security 30 day after selling it, in order to recognize a loss.
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