How is tax avoided through Bond washing transactions?

Tax avoidance through bond washing transactions is a practice in which individuals or entities engage in financial transactions with the intention of minimizing their tax liability on capital gains or losses from bond investments. Bond washing transactions exploit certain tax laws or loopholes to achieve this objective. It's important to note that while tax avoidance is legal, tax evasion, which involves illegal means to evade taxes, is not.

Here is an explanation of how tax avoidance through bond washing transactions works:

1. Purchase and Sale of Bonds:

• Bond washing typically involves two main transactions: the purchase and sale of bonds.
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