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Learning, Sharing, and Teaching => Investor Alley => Topic started by: sb_NoVA on February 24, 2015, 09:13:11 PM

Title: How to avoid wash sale rule?
Post by: sb_NoVA on February 24, 2015, 09:13:11 PM

I have VTIAX in my Roth IRA.  Dividends are automatically invested and I don't have an option to not have them reinvest (am I missing something?)

I have VTIAX and VTSAX in my taxable accounts as well.  If I happen to sell my VTIAX in taxable and my dividend in Roth gets reinvested, will that trigger wash sale rule?  How do I go about avoiding that?  There seem to be no options in Vanguard Roth IRA to open a Money Market type account where dividends can be deposited. 

Title: Re: How to avoid wash sale rule?
Post by: Cressida on February 24, 2015, 10:01:05 PM

I'd love for someone knowledgeable to weigh in on this. I recently looked into starting tax loss harvesting in Betterment, come to find out that they have this enormous disclaimer on their site that if you do turn on TLH, you're certain to trigger wash sale restrictions if you hold investments pretty much anywhere other than Betterment. Doesn't that make TLH useless? What gives?

Title: Re: How to avoid wash sale rule?
Post by: sb_NoVA on February 25, 2015, 04:38:28 AM

Thanks.  To reduce complexity, I think I should switch to VFIAX in Roth.  I wouldn't need to worry about tracking reinvested dividends.

Title: Re: How to avoid wash sale rule?
Post by: forummm on February 25, 2015, 07:21:54 AM

Quote from: sb_NoVA on February 25, 2015, 04:38:28 AM

Thanks.  To reduce complexity, I think I should switch to VFIAX in Roth.  I wouldn't need to worry about tracking reinvested dividends.

80% VFIAX and 20% VEXAX is essentially the same as VTSAX