Which Condition Is Not True of a Wash Sale

question 45

Multiple Choice

Which condition is not true of a wash sale?

• A)A wash sale occurs when a taxpayer sells securities at a loss and reinvests in substantially identical securities within 30 days before or after the date of sale.
• B)A taxpayer who transacts a wash sale has not had a change in economic position.
• C)The numbers of shares purchased and sold are not always the same.
• D)When the number of shares repurchased is less than the number sold, none of the loss is deductible.

---

Definitions:

Business Operations

Activities involved in the day-to-day functions of a business related to producing and delivering products or services.

Unlimited Liability

A legal structure in which owners are personally and fully responsible for all debts and liabilities incurred by the business.

Personal Assets

Assets owned by an individual as opposed to those owned by businesses or governments, including tangible and intangible items.

Original Capital Investment

The initial sum of money used to start a business or investment, often used for assets, inventory, and other startup costs.