Wash sale question
Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
Announcements
TurboTax has you covered during Covid. Get the latest second stimulus info here.
cancel
Showing results for 
Search instead for 
Did you mean: 
Returning Member

Wash sale question

Wash-sale problem Etrade

Hello, 

During the earlier part of the year I did a lot of high frequency  day trading, and still day trade a lot

 

looking at my taxable gains though on my Etrade, it shows that I have 300,000K of disallowed losses !!!! from wash sales.  It is true that engaged in a lot of wash sales but I only hold a few positions now and they are not associated with the disallowed losses

 

most of the disallowed losses were associated TVix, SQQQ, and Sdow day trades, and I don't hold any of those for the last several months, sold them in July

But it looks like the wash sales just kept accumulating whereas I don't see the allowed loss when I finally got rid of the positions

I'm terrified that I will have a huge tax fill! how can I get out of this?  My account is only about 250K total and its more or less net even for the year so how can this happen?  it does not make logical senses.  

How do I get out of this situation, is my broker misreporting and not adding to my final cost basis?  they are closed now on the weekend.

 

It doesn't make sense I still have wash sales disallowences when no longer own the positions

 

thank you

7 Replies
Level 14

Wash sale question

Your broker is in a much better position to help you than anyone on this site. 

Level 15

Wash sale question

Please call the broker and let them explain their reporting documents.  But closing out the position will not negate the first sale that has the wash sale listed.  When you get the 1099-B in February it may make more sense. 

Anonymous
Not applicable

Wash sale question

E*TRADE and all other US brokers are required by the IRS to account for wash sales.  the broker is supposed to add the disallowed loss to the basis of the shares that caused the wash sale.  when you sell those shares since your basis has been increased the wash sale loss is included in the net gain or loss that is reported.  example: buy shares for $7 that cause a wash sale loss of $2. your basis is now $9. sell for  $10 you now have a net $1 gain. sell for $8 you now have a net $1 loss.    holding period of the wash sale shares tacks on to the replacement shares so a short-term wash sale loss can turn into long-term if the replacement shares are held long enough 

Level 15

Wash sale question

Unfortunately, trades with an adjustment have to be reported on Form 8949.

A wash sale disallowed loss is an adjustment, code "W".

 

You will have to supply the details to IRS on Form 8949 or in equivalent form , e.g. consolidated 1099-B year-end printout.

Anonymous
Not applicable

Wash sale question

perhaps your broker is among those where you can import your brokerage activity.  you would still be responsible for verifying accuracy. 

Level 15

Wash sale question

the triggering transaction takes on the disallowed loss of a wash sale.

It all evens out in the end.

In the old days, when the rules were established, investors didn't do thousands of transactions a year.

Anonymous
Not applicable

Wash sale question

broker's reports will show the wash sale. sell the shares causing the wash sale and brokers will show a reduced gain or increased loss. but most will not note that this has occurred. 

Dynamic Ads
v
Privacy Settings