Exchange IXUS to IEFA is that a wash sale?

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big bang
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Exchange IXUS to IEFA is that a wash sale?

Post by big bang »

Hello bogleheads,
I currently have IXUS (iShares Core MSCI Total International Stock ETF) in my taxable account which has a loss and I want to do Tax Loss Harvesting.
Can I but immediately IEFA (iShares Core MSCI EAFE) without being subject to the Wash Sale Rule?
Appreciate the advice.
Stay safe!
(1) save a lot, (2) select an asset allocation containing both stock and bond asset classes, (3) buy low cost, widely diversified funds, (4) allocate funds tax-efficiently, and (5) stay the course.
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whodidntante
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Re: Exchange IXUS to IEFA is that a wash sale?

Post by whodidntante »

No it's not a wash sale.
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big bang
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Re: Exchange IXUS to IEFA is that a wash sale?

Post by big bang »

Thank you WhoDidntAnte

Anyone else to comment on this move before I make the move?
(1) save a lot, (2) select an asset allocation containing both stock and bond asset classes, (3) buy low cost, widely diversified funds, (4) allocate funds tax-efficiently, and (5) stay the course.
UpperNwGuy
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Re: Exchange IXUS to IEFA is that a wash sale?

Post by UpperNwGuy »

big bang wrote: Mon Mar 23, 2020 12:46 pm Thank you WhoDidntAnte

Anyone else to comment on this move before I make the move?
Go read the Boglehead Wiki on Tax Loss Harvesting and you will see a table near the end that shows these two funds in separate categories.
Angst
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Re: Exchange IXUS to IEFA is that a wash sale?

Post by Angst »

https://www.bogleheads.org/wiki

Search for TLH or tax loss harvesting and find the link,
https://www.bogleheads.org/wiki/Tax_loss_harvesting
terran
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Re: Exchange IXUS to IEFA is that a wash sale?

Post by terran »

I mean this in the "teach a man to fish" sense, not to sound snarky, so please take it as such.

From the factsheet at the bottom of the iShares IXUS page: "The iShares Core MSCI Total International Stock ETF seeks to track the investment results of an index composed of large-, mid- and small-capitalization non-U.S. equities." It invests in 4,380 companies.

From the factsheet at the bottom of the iShares IEFA page: "The iShares Core MSCI EAFE ETF seeks to track the investment results of an index composed of large-, mid- and small-capitalization developed market equities, excluding the U.S. and Canada." It invests in 2,457 companies.

Do those sound substantially identical to you?
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big bang
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Re: Exchange IXUS to IEFA is that a wash sale?

Post by big bang »

Thank you all for the information. Just wanted to make sure that I was going to do the right thing.
Order executed. Exchange completed!
Thank you again for the assistance.
(1) save a lot, (2) select an asset allocation containing both stock and bond asset classes, (3) buy low cost, widely diversified funds, (4) allocate funds tax-efficiently, and (5) stay the course.
MnD
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Re: Exchange IXUS to IEFA is that a wash sale?

Post by MnD »

Not a wash sale. But if you see IEFA flat or at a loss any time in the future consider selling it and buying VXUS.
IXUS and VXUS are much better tax loss pairs as they are both track much more complete international indexes.
IEFA is missing 30% of the international market - namely all emerging markets and Canada.
70/30 AA for life, Global market cap equity. Rebalance if fixed income <25% or >35%. Weighted ER< .10%. 5% of annual portfolio balance SWR, Proportional (to AA) withdrawals.
stan1
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Re: Exchange IXUS to IEFA is that a wash sale?

Post by stan1 »

I would use VXUS and IXUS but your call on whether you think they are too similar. Some people think they are, some people don't, and the IRS has not stated their opinion.
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