I've not heard of that rule before. Please illuminate that one to me(seriously). What I know is any capital gain is taxable regardless of if you reinvest it. Only exception is for real estate of insurance (1031/1035 exemption). Stocks don't receive that benefit. Other exemption is if it's in an IRA TYPE FUND . If you know is something Else please post - my taxes are a beast this year! LoL ??