THE two month rule in stocks Its purpose is that an investor does not declare fictitious losses when repurchasing the same assets that he sold with a loss in value in a short period of time.
This is a tax law, also called anti-action rule and consists of block the attribution of losses to personal income tax if there is a share repurchase within the two month period.
Below we will tell you everything in more detail.
What is the two month rule?
The 2-month rule is included in Article 33.5, letter g) of the Personal Income Tax Law and affects securities transactions (like stocks).
In simple terms, yes sell some shares at a lossAs a general rule, you can offset this loss against other profits on your tax return.
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However, this can lead to fraud, as many investors sell at a loss and buy back the same shares in a short period of time, with the sole purpose of generate artificial lossestake advantage of the compensation and pay less personal income taxes.
Therefore, tax regulations dictate that when repurchases occur within two months before or after the sale, The Treasury will not allow you to offset that loss with your return. This is the two-month rule in stocks.
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When does this rule apply and when does it not apply?
The rule does not always act in the same way, There are cases where it has no application.
We list the most common cases in detail:
Applies:
- When you sell stocks at a loss and buy back the same stocks within 2 months before or after the sale.
- When you purchase equivalent (homogeneous) securities to those you sold within the established period.
- When the buyback is made by a related person (partner, close relative or company controlled by you).
Not applicable:
- If you sell at a profit, as it only adjusts capital losses (not capital gains).
- If buybacks are made on different values.
- In transactions with derivatives, CFDs or unlisted shares the duration can be extended up to 12 months.
How to declare income losses?
When the 2 month rule is triggered, losses are temporarily blocked. In practice you have to indicate it in your tax return This is a “Non-imputation of losses due to the repurchase of homogeneous securities”. This is how it looks in the Renta WEB program.
For example:
- You generate a capital gain from the sale of company A shares: 2,000 euros
- You generate a loss in another operation by selling shares of company B: -500 €
- The result to be declared based on personal income tax savings would be: 2,000 – 500 = €1,500
In principle, you should only pay tax on this amount (1,500 euros), but if the loss could not be attributed because you repurchased the B shares in less than two months after their sale, The profit to be declared would be 2,000 euros.
You should check the “No loss attribution for the repurchase of similar securities” box and the Treasury will not subtract the 500 euro loss.
Practical example of the two-month rule
For example, imagine making these trades on the stock market:
You buy 100 shares of the company XYZ worth 1,000 euros (at a price of 10 euros per share).
A month later, the value drops to €8 per share and you decide to sell them. Get an amount of €800.
You have generated a loss of €200 which you can declare and offset against other profits in your tax return.
However, if you decide buy back the same shares Within 15 days the Treasury will consider that the disability is blocked and cannot be compensated.
| Operation | Date | Amount | Result |
| Purchase of 100 shares of XYZ | February 1 | €1,000 | – |
| Sale of 100 shares of XYZ | March 1st | 800 | -200 (loss) |
| Purchase of 100 shares of XYZ | March 15 | 850 | Previous loss cannot be attributed |
Only when you sell those shares in the future and don’t buy them back within that period will you be able to allocate the loss.
The reason is that the buyback shows intentions to maintain the positionnot to close a failed investment.
Frequently asked questions about the two-month rule
What happens if I only buy back a part?
Only the loss corresponding to the repurchased shares is blocked; the rest can be declared normally.
Does it apply to ETFs and cryptocurrencies?
Yes, if the product is considered “of homogeneous value”. In the case of cryptocurrencies, regulation still sparks debate, but the Treasury usually applies the same criteria. If you trade crypto, learn how to handle it properly with this cryptocurrency course.
What happens if I trade with different brokers?
The Treasury consolidates all your trades, regardless of which intermediary you use, so the 2 month rule in stocks still applies.
