# stock and taxes

**URL:** <https://boards.straightdope.com/t/stock-and-taxes/86291>\
**Category:** Factual Questions\
**Created:** [October 9, 2001, 7:36am UTC](https://boards.straightdope.com/t/stock-and-taxes/86291 "2001-10-09T07:36:06Z")\
**Posts on this page:** 3\
**Page:** 1

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**Author:** ![dtilque](https://avatars.discourse-cdn.com/v4/letter/d/d6d6ee/32.png) [@dtilque](https://boards.straightdope.com/u/dtilque)\
**Post date:** [October 9, 2001, 7:36am UTC](https://boards.straightdope.com/t/stock-and-taxes/86291/1 "2001-10-09T07:36:06Z")

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For tax purposes, are shares of stock to be treated as FIFO or LIFO?

For instance, suppose I buy 100 shares of XYZ Corp. at $20. It promptly goes down (as do far too many of my stocks) and when it gets down to $10, I buy 100 more shares. Finally it decides to go up and when it gets to $15, I sell 100 shares.

When I figure my taxes for this sale, do I count a $500 gain or loss? Does it make any difference if the last two transactions were within a 30 day period?

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**Author:** ![Erwin\_Deja\_Wu](https://avatars.discourse-cdn.com/v4/letter/e/c68b51/32.png) [@Erwin\_Deja\_Wu](https://boards.straightdope.com/u/Erwin_Deja_Wu)\
**Post date:** [October 9, 2001, 8:07am UTC](https://boards.straightdope.com/t/stock-and-taxes/86291/2 "2001-10-09T08:07:41Z")

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ha, nobody’s interested in tax, megalol (s0rrie) I would say something meaningful but i don’t know what you are talking about ☹

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**Author:** ![lucwarm](https://avatars.discourse-cdn.com/v4/letter/l/e19adc/32.png) [@lucwarm](https://boards.straightdope.com/u/lucwarm)\
**Post date:** [October 9, 2001, 12:16pm UTC](https://boards.straightdope.com/t/stock-and-taxes/86291/3 "2001-10-09T12:16:42Z")

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> [@](#):
>
> \*Originally posted by dtilque \*  
> \*\*For tax purposes, are shares of stock to be treated as FIFO or LIFO?
> 
> For instance, suppose I buy 100 shares of XYZ Corp. at $20. It promptly goes down (as do far too many of my stocks) and when it gets down to $10, I buy 100 more shares. Finally it decides to go up and when it gets to $15, I sell 100 shares.
> 
> When I figure my taxes for this sale, do I count a $500 gain or loss? Does it make any difference if the last two transactions were within a 30 day period? \*\*

> **[How to Compute Capital Gains - Investment FAQ](https://invest-faq.com/how-to-compute-capital-gains/)**
>
> How to Compute Cap GainsContents1 How to Compute Cap Gains2 Selling Share of Stock Example3 Selling Shares of Mutual Funds Example Gains made on equities (i.e., stocks or mutual funds) are subject to capital gains taxes. In the simplest case, you...

According to this article, you can choose (in advance of the sale) which lot of shares you are selling. i.e. You would tell your broker “sell the shares that I bought at $20.”

If you don’t specify, the default is FIFO (according to the article).

I don’t believe that the “thirty day wash rule” has application in your scenario, since you are not selling and then immediately repurchasing – you are doing the opposite, if anything.

(Standard disclaimer about legal advice, ask your accountant, blah blah)