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Level 4

How to correct a wash sale error

I have a wash sale that I believe is incorrect.

 

I placed one buy order of 2,000 shares of a stock. The broker filled it in five stock lots.

 

I later placed one sell order of the 2,000 shares, at a loss.

The broker filled the sell order in two stock lots.

That is what created the wash sale.

 

The timestamps for both the purchase lots and sale lots are all identical.

 

Do you believe I am still liable for this wash sale, even though it was not of my doing?

 

If you agree that I should be able to remove/adjust it, could you please tell me how to indicate/explain this correction in Turbo Tax?

 

Thanks!

2 Replies
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Level 19

How to correct a wash sale error

sounds like a mess but it should not be.

First, do the arithmetic to see if the 8949 results in the full amount of your loss being allowed.

(This is what should happen after all the adjustments for wash sales are applied).

If so, there is nothing to do. Reply back.

 

.You can enter the transaction manually as one buy, and one sell. Reply back if you need more assistance.

Level 14

How to correct a wash sale error

you statement that the varying lots caused the wash sale gives me pause.  did you happen to buy that same stock again within 30 days of the sale?  if you did, then THAT is what is driving the wash sale .

 

selling shares by themselves when you close out the position (purchase 2000 shares and sell 2000 shares) doesn't by itself create a wash sale 

 

example: 

 

1) buy 2000 shares @ $10 on January 2

2) sell 2000 shares  @ 9 on January 3 (capital loss of $2000)

3) buy 2000 @ 8 on January 4 (wash sale - capital loss must be deferred)

 

that is a wash sale. the losses that occur on January 3 can't be taken until the lots purchased on January 4th are sold.