@jigo Wash sales definitely apply. Since the cost basis of the entire holding is "unified" (i.e., average cost) the disallowed loss affects all your remaining shares, not just the lot that triggered the wash. Only holding period would be adjusted for the lot that caused the problem.
You should talk to the K-1 preparer to see what their capabilities are, but you should also maintain your own records regardless:
- The K-1 preparer is usually just a vendor to the partnership. Different preparers have different capabilities. Some may be able to account for wash sales and track the change in holding period and disallowed losses. Others may not.
- Even if your K-1 preparer can track it today, you have to prepare for the possibility that the preparer changes in the future.
At a minimum, your broker will be able to accurately track your holding period, and you'll have to keep track of disallowed losses that need to be added into future sales schedules.
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**Note also, I'm not a Tax Preparer/CPA. Just a volunteer, seasoned, TurboTax user.
Use any advice accordingly!
