The shares of HGT I own have a basis higher than the current market. I was thinking about selling here and then repurchasing them back after 31 days so as to get the tax write off yet still own the shares. I have never done this with a royalty trust before...is there something I am missing with regard to doing that? Anybody have any thoughts?
I believe...you'll get hit with round trip tax prob if you have also bought, in any account, this stock 31 days BEFORE you sell it. you can't buy 31 days before or after you sell, in any account. i got stung with this once when i didn't buy, but received dividends in kind, and those are viewed as buying, by the IRS. unsure if there is a diff in receiving dividends/distributions in cash vs in kind. if it's both, then that will make it tough [impossible] to sell this stock for tax loss, cuz we get something each month.
Yes, all your past tax deferral on distributions would be recaptured (assuming you file the correct tax forms). If you have only owned a short period this might be worth doing. If you have held for many years the tax implication may make it prohibitive.
I believe the relevant form is 4797 - Sale of Business Property.