Note 17 - Wash Sales

[JessicaW-TMIC]

My company is non-taxable, therefore do not have any tax implications from wash sales. Are we required to complete the disclosure for wash sales?

[Lisa]

Jessica,
The 2021 orange blank annual statement instructions for footnote 17 includes the following description of the wash sale disclosure requirements. I also recommend review of SSAP No. 103R referenced in the instructions below. I do not believe your tax status would exempt you from the disclosure requirements in the orange book for Note 17, but you could confirm with your regulators or outside auditors.

A reporting entity shall disclose the following information for wash sales, as defined in SSAP No. 103R?Transfers and Servicing of Financial Assets and Extinguishments of Liabilities for all affiliated investment transactions (including items originally classified as cash equivalents and short-term investments) and for non-affiliated investment transactions with an NAIC designation of 3 or below, or that do not have an NAIC designation For non-affiliated investments, all cash equivalents, derivative instruments and short-term investments with credit assessments equivalent to an NAIC 1 or 2 designation are excluded from this disclosure. This disclosure shall be included in the financial statements for when the investment was initially sold. For example, if the investment was sold and is only applicable for sales and purchases that cross quarter-end or year-end reporting periods on Dec. 20, 2021, and reacquired on Jan. 10, 2022, the transaction shall be captured in the wash sale disclosure included in the year-end 2021 financial statements, while an investment sold on May 1, 2021 and reacquired on May 20, 2021 would not be required to be disclosed. (The disclosures shall be made for the current quarter in the quarterly statement, and for the year in the annual statement.)

Regards,
Lisa Mullen