Yes, you can adjust your cost basis to correct it and no, it won't raise red flags with the IRS. Cost basis corrections are a common occurrence.
Tax Tip: Your total capital gains for the year minus your total capital losses result in a net gain or a net loss.
- You can deduct a net loss of up to $3,000 ($1,500 if married filing separately). Any capital loss you couldn't deduct this year can be carried forward and deducted on future tax returns as a capital loss carryover.
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