"Accrued market discount should not be 0. Enter amount disallowed under wash sale rules..." I have several wash sales. They're all less than $1. How should I proceed?

[steven-morris24]

I can see on my 1099-B there are several wash sales in column 1g.  They are all less than $1 (approx $.01, or $.15, etc).  I entered these amounts in the Federal Wages and Income section, but I get an error when I do the review at the end which says, "the amount should not be 0."  I didn't enter 0, it must be rounding down.  

How do I proceed without the error?

[rjs · Accepted solution]

You can't correct the problem in Smart Check. You have to go back to where the sales were entered under Investment Income > Stocks, Mutual Funds, Bonds, Other. Edit each sale and delete the wash sale loss amount. In other words, since the wash sale loss is less than 50 cents, you don't report it as a wash sale.

This is only a problem with disallowed loss amounts of less than 50 cents. If it's 50 cents or more, leave it. It will get rounded to $1.

[etlapa]

Thank you so much. It helped me out a lot. It's annoying to waste a lot of time trying to figure out that an amount less than $1USD must be rounded up or removed. I think this is an improvement for the Turbo Tax platform.

[cfilipponi]

When i correct this problem for 2 of my sales,  my state tax payment goes up a few dollars.  Why would this be?

[WendyN2]

Try entering $1 even and see what the outcome is. I am very interested to know how that happened, however! Your State Taxes went up. Makes no sense. In any event, try what I suggested and please let me know if that worked. 

[cfilipponi]

I changed my .38 cent short sale and my .06 cent short sale to 1.00.  My state taxes due went up 9.00.  I tried to find out what happened on the state side but was unable to find what changed.  I think I will just submit with the 2 forms in error on the Fed side.  I mean they actually are not in error since the information contained is accurate.

[rjs]

@cfilipponi  They actually are in error. The information you entered is not accurate. Amounts of $0.38 and $0.06 get rounded to zero, not $1. You should go back and delete the two disallowed wash sale loss amounts. Don't enter zero. Don't enter $1. Just leave the box blank.

I'm not sure, but you might find that deleting the amounts also eliminates the extra state tax.

[cfilipponi]

I originally did blank out the field.  Maybe I will try and enter 0 and see if that works.

[bjssfca]

My understanding was that if there was a zero in box 1g is should be deleted and left blank.  I did this which truly is a pain but I still have the same error messages as though my edits did not save.  What should I do?

[cfilipponi]

Well leaving the box blank raises my PA taxes by 11 dollars.  Believe me when I say those 2 forms can stay in "error" with the correct information from my broker vs paying the state 11 more dollars .   😉

[cfilipponi]

There ya go!  Latest update removed the error without needing to change any of the data that was imported from my financial institution  ;-O