How do you all invest in vanguard, wealthfront, betterment, robinhood, 401k without triggering wash sale rule?

Jan 14, 2018 7 Comments

New to investing and curious how you all deal with wash sale rule (in anticipation of tax season)?

I currently have most of money invested in wealthfront with TLH and DI turned on. Due to DI, wealthfront buys and sells individual stocks too.

Now, I also like to buy some individual stocks via robinhood (rarely) if I think they are interesting.

Additionally, I am also sometimes buying VTI separately through vanguard and also have employer 401k.

Now I know that all these platforms are linked to turbotax for automated tax doc imports.

Do I need to manually investigate my claimed losses in my final tax report to make sure I dont have any potential wash sales?

Sounds like a pain in the A :(

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TOP 7 Comments
  • Gen!x / Eng
    XPbr65

    Gen!x Eng

    PRE
    Bank of America Merrill Lynch, HPE, Northrop Grumman
    BIO
    mehy
    XPbr65more
    Just trade in a Roth or Rollover IRA account so you don’t have to worry about any tax reporting

    That’s what I do. YUUGE time saver.
    Jan 14, 2018 0
  • Google tentenths
    Add individual stocks to your list of exclusions in settings
    Jan 14, 2018 1
    • Amazon RTvB83
      OP
      That seems reasonable to avoid wash sales on stocks but i may still have wash sales on etfs likeVTI etc. I think I need to close my vanguard account. I opened it as it gives flexibility to pick and cboose individiual etfs.
      Jan 14, 2018
  • Microsoft sqiF24
    Easy. Don't sell at a loss and within 30 days buy a substantially identical stock.
    Jan 14, 2018 2
    • Amazon
      i❤️🚂🚃🚃

      Amazon

      BIO
      🚂🚃🚃🚃🚃🚃🚃🚃🚃🚃🚃🚃🚃🚃🚃🚃🚃🚃!
      i❤️🚂🚃🚃more
      So the issue is that you don't really know what the robo advisor is about to do on your behalf. If it executes trades on the same stock you did in your directly managed account it can create a tax headaches for you.

      Which is why I just invest in vanguard directly and skip the robo advisor, then there is no issue and your advice is easy to follow.
      Jan 14, 2018
    • Microsoft sqiF24
      Ah, then I now see the problem. Thank you!
      Jan 15, 2018
  • Splunk / Eng
    MrSplow

    Splunk Eng

    PRE
    Microsoft
    MrSplowmore
    Wealthfront supposedly avoids trades that might trigger the wash sale rule. But in the long run, it really doesn’t matter since you can just add the wash sale loss to the cost basis of the new purchase.
    Jan 14, 2018 0

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