Wash sale

From: SMabel555@aol.com
Subject: Wash sale
Date: Thu, 14 Jan 1999 17:02:56 EST

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I bought 100 shares of  a stock 3 years ago for $4.

It was recently trading as low as $0.25.    I bought another 400 shares.

What is the impact / meaning of a wash sale?  As I interpret it, if I sell the
400 shares for $1 (profit = $300 - commissions), then sell the 100 shares at
$1 (loss = $300), I DO NOT GET TO CLAIM THE LOSS for tax purposes.

Is this correct?  Are there any other impacts?  Would it matter if the loss &
gain  did not exactly cancel each other out?

SM

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