Wash sale rules apply if you sell an investment at a loss and buy back the same or a similar one within 31 days. VOO and SPY are nearly identical, so it’s a gray area. Roll the dice if you want, but keep us updated.
I’m asking to avoid rolling the dice! That’s why I wanted opinions. Thanks anyway.
Fidelity flagged my VOO-to-ITOT swap as a wash sale, so tread carefully.
If you’re not sure about taxes, maybe ask a tax professional instead of this forum.
No, selling VOO to buy SPY isn’t a wash sale since they’re run by different funds. But selling a Vanguard mutual fund and buying the ETF equivalent within 30 days would be considered a wash sale.
Actually, different classes of stock aren’t always considered substantially similar. The correlation between their prices matters. Also, the same argument applies to SPY and VOO—they’re similar enough to be risky under wash sale rules.
Yeah, that would be a wash sale. No, your broker won’t flag it, so it’s your risk to take. Better to hold a different fund for a month or two.
I’ve never heard of anyone losing a tax deduction for selling VOO and buying SPY. The IRS hasn’t clarified this officially, but it’s not something they’ve enforced.
The IRS being vague doesn’t mean you’re safe. You’re still taking a risk.
True, but if the IRS hasn’t enforced this in 50 years, it’s unlikely they’ll start now. Still, switching to VTI for 31 days is the safer bet.
Wash sales are enforced for high-value portfolios, but index fund swaps haven’t been flagged as wash sales so far.
Switch to VTI and stick with it if you’re on a DCA plan. Later, you can flip back to VOO if you want.