Since Pennsylvania does not comply with the wash rule. How do I adjust the cost basis of the asset?

[DianeW777]

You are correct.  Pennsylvania (PA) looks at each transaction in the tax year independently.  Then after combining all capital gains and losses for a net result in that calendar year.  If that net result should happen to be a negative or loss, it cannot be used against any other class of income on the PA return. 

When you are preparing the PA return in the State interview, you will reach a page titled 'Schedule of Gains/Losses'. You should not need to edit the wash sale for PA, but review your sales on this page.  Do not check the box beside 'This sale is not taxable in PA' (this could apply to a nonresident).

See the image below for assistance. In my example the loss was $100, named Wash Sale vs a stock name or symbol.

[bob2968]

can't read the example

[Anna4188]

I'm currently having this exact issue. Did you happen to figure out what to do? Did you have to manually adjust every trade? I have hundreds and hundreds of day trades. Did you actually mail in your entire 1099-b? Please share if you can!! Thank you!

[Anna4188]

I'm currently having this exact issue. Did you happen to figure out what to do? Did you have to manually adjust every trade? I have hundreds and hundreds of day trades. Did you actually mail in your entire 1099-b? Please share if you can!! Thank you!

[marc.86.williams]

What should be done in TurboTax when reaching this wash sales portion of the Pennsylvania State income tax preparation.  There is no clear guidance from TurboTax.  Should I assume TurboTax computed the transactions correctly and just walk through them without adjustment to cost basis?  HELP 

[ErnieS0]

Your Pennsylvania income tax return should be correct. PA does not recognize wash sales and TurboTax transfers transactions to the state return without wash sales.

PA says, “The federal wash sale provisions do not apply for Pennsylvania personal income tax purposes. For Pennsylvania purposes, every transaction is considered separate and independent of any subsequent transaction.”

Related Resource:

• Net Gains (Losses) from the Sale, Exchange, or Disposition of Property

@marc.86.williams

[pzanga]

I'm in PA with the same question and looking for some clarification.  I have a number of wash sales (losses) in my Gains and Loss Summary.  You say "Your Pennsylvania income tax return should be correct. PA does not recognize wash sales and TurboTax transfers transactions to the state return without wash sales."  Does this mean we do not have to select "Edit" for any of the wash sales and choose from the available options (see screenshot), in particular the adjustment to the basis option?  I.e. can the wash sales on the gains and loss summary be ignored?

[ErnieS0]

Yes. TurboTax adjusts for Pennsylvania wash sale rules and includes disallowed losses. You do not have to make any basis adjustments for wash sales in the PA section.

Out of an abundance of caution, you should always check to see whether your transactions are being reported properly.

@pzanga 

[bafroman]

So just want to be sure I understand. I had losses on sales of securities federally, and now I am at my PA return and have that screen already listed by others asking those 4 questions (sale not taxable in PA, asset acquired before 1971, asset used for both business & personal, and sale requires adjustment to basis). Do I ignore those 4 questions completely because the Federal has transferred the amounts properly to the State?  I have looked through all my paperwork from broker and can't seem to find an answer. Thanks.

[AmyC]

Yes. The first option is for nonresidents. The second option has a time period. The third must not apply to you. This leaves the 4th and if you have no other adjustment, none of these apply to you.

@bafroman