TLH VTSAX to VFIAX - Wash sale?

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TLH VTSAX to VFIAX - Wash sale?

Post by jpohio » Tue Dec 18, 2018 9:32 am

If I TLH Total Stock Market Index (VTSAX) to 500 Index (VFIAX) will IRS consider that a wash sale?

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Re: TLH VTSAX to VFIAX - Wash sale?

Post by UpperNwGuy » Tue Dec 18, 2018 9:52 am

No, it will not, provided you follow the other TLH rules. People use those two funds as TLH partners all the time.

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Re: TLH VTSAX to VFIAX - Wash sale?

Post by SpringMan » Tue Dec 18, 2018 10:37 am

VLCAX, Vanguard's Large Cap Index, is also a good TLH partner for VTSAX though ER is .05% vs .04% for VFIAX.
Best Wishes, SpringMan

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Earl Lemongrab
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Re: TLH VTSAX to VFIAX - Wash sale?

Post by Earl Lemongrab » Tue Dec 18, 2018 2:57 pm

The real answer is that no one knows. The IRS has given scant information on what "substantially identical" means. It's a common belief here that a different index is all that's required. To my knowledge, there has not been an identified case where the IRS declared a wash sale between two different funds, index or otherwise.

I think people worry about wash sales too much. It's not something that seems to be important to the IRS.

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