If you sell an option but it is not filled, you cannot immediately sell the same option again without it being considered a wash sale. The IRS rules regarding wash sales apply to both successful and unsuccessful sales of options.
Here's what you need to consider:
- Unfilled sale: If you place a sell order for an option and it is not filled within a reasonable time frame (typically 30 days), you may still be liable for a wash sale if you buy the same option within 30 days of the unsold order.
- Re-selling the option: If you sell an option and it is not filled, you cannot simply sell the same option again without waiting at least 30 days. If you sell a substantially similar option within 30 days, it could be considered a wash sale.
- Avoiding wash sales: To avoid being caught in a wash sale scenario, make sure to wait at least 30 days after the initial sale (whether it was successful or not) before selling the same option or a substantially similar option.
It's important to note that the IRS does not provide specific guidance on how brokers should report wash sales, and the rules can vary depending on the broker's policies1. Therefore, it's always a good idea to consult with a tax professional or your broker to ensure compliance with tax laws and regulations.
10/29/2024 11:41pm
