Selling unrealised stock position to reduce taxes, then buying again. Am I off the hook?

Question

I have a realised profit for the current year of $1000. (On which I will be required to pay taxes).
I have another position that is unrealised (still holding the stock) that is negative $1000.
Now if I liquidate this losing position I would not have to pay any taxes. (Ending balance $0 profit).
Now the question:
What if after selling the unrealised position I immediately buy the same exact position (and manage to get the same price).
Am I still on the hook to pay taxes or is my taxable amount still $0 for that year?

GOATNine · Accepted Answer

You will still owe taxes on your gains of $1000.
This is covered by the Wash-Sale Rule.

The wash-sale rule prohibits selling an investment for a loss and
replacing it with the same or a "substantially identical" investment
30 days before or after the sale.

This is not tax fraud, unless you claim the loss despite the rule.

Selling unrealised stock position to reduce taxes, then buying again. Am I off the hook?

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