topic Wash Sale Loss Disallowed in Get your taxes done using TurboTax

Wash Sale Loss Disallowed

laxworld322 — Fri, 19 Feb 2021 00:08:01 GMT

I keep getting told that I need to fix my federal return which brings me to fix some wash sales (1g) on the order of pennies. The box doesn't let you enter any decimals. I'm unable to move past this without resorting to file by mail.

Apparently multiple other people are having the same issue, with no response from Turbotax.

Re: Wash Sale Loss Disallowed

JohnB5677 — Sun, 21 Feb 2021 14:44:35 GMT

To enter a disallowed Wash sale:

Income & Expenses

Scroll to Stocks, Mutual Funds, Bonds, Other
Answer Yes to Did you sell stocks, mutual funds, bonds, or other investments in 2020?
On the OK, what type of investments did you sell? screen, select Stock, Bonds, Mutual Funds. Then select Continue.
From here, you can import or manually enter your 1099-B.
Answer the questions about your sales. Choose to Enter sales one by one when asked.
On the Now, we'll enter one sale on your 1099-B screen, enter your info.
Check I have other boxes on my 1099-B to enter and enter the disallowed wash sale loss in box 1g.
Select Continue and answer any follow-up questions.

Note: You'll need TurboTax Premier, TurboTax Live Premier, or TurboTax Self-Employed, TurboTax Live Self-Employed, to add any 1099-B forms.

Re: Wash Sale Loss Disallowed

laxworld322 — Tue, 23 Feb 2021 00:46:27 GMT

@JohnB5677 This is not the issue. I have already entered the wash sales. I have reviewed them on the page where you enter wash sales and the numbers are correct according to my 1099-B. However, Turbotax tells me that there is a problem and that I must review those sales. While going through turbotax review for the wash sales (different page then where you enter the wash sales) the values have all rounded to 0 and it is impossible to enter decimal values - everything gets rounded. The prompt to review the numbers never goes away and I am unable to file.

Re: Wash Sale Loss Disallowed

AnnetteB6 — Tue, 23 Feb 2021 14:29:20 GMT

This issue is currently being investigated and addressed by the appropriate team. In the meantime, see the information below for two possible workarounds -- editing each individual transaction affected, or entering a summary of your transactions and possibly submitting Form 8453 and your documentation to the IRS.

The error messaging you are seeing with regard to the wash sale entries is a result of automatic rounding of the number imported from your broker or typed in by you. If the wash sale adjustment is $0.49 or less, then it is automatically rounded to zero. This type of rounding is allowed by the IRS. Unfortunately, zero is not a valid value for this field -- thus the error message.

To resolve the issue, you can edit each individual transaction (although not from the screen in the review process) and delete the amount entered in the wash sale adjustment if it is $0.49 or less. This will clear the error message.

To do this, you will need to revisit the input section for the Form 1099-B transactions. Use the following steps:

On the top row of the TurboTax online screen, click on Search (or for CD/downloaded TurboTax locate the search box in the upper right corner)
This opens a box where you can type in “1099-B” and click the magnifying glass (or for CD/downloaded TurboTax, click Find)
The search results will give you an option to “Jump to 1099-B”
Click on the blue “Jump to 1099-B” link
Click Edit beside the institution name
Click Edit beside each transaction that contains a wash sale adjustment amount of $0.49 or less
Delete the wash sale adjustment amount and click Done

If you have too many transactions that would require editing, you can consider deleting your imported information and entering a summary of the different categories of transactions reported on your Form 1099-B (short-term covered, short-term not covered, long-term covered, long-term not covered). This may require you to mail a copy (not the original) of your Form 1099-B from your brokerage to the IRS within three days of filing your return. The Form 1099-B would be attached to Form 8453, which will print with your return.

@laxworld322

Re: Wash Sale Loss Disallowed

Xer — Wed, 24 Feb 2021 02:32:15 GMT

how long would it take the team to fix this issue?

Re: Wash Sale Loss Disallowed

TerukoL — Wed, 24 Feb 2021 02:55:41 GMT

As of right now, we do not have an ETA on when our tech team will resolve the issue, but they are working as quickly as possible. Please check back soon.

Re: Wash Sale Loss Disallowed

fukboi4lyf — Wed, 24 Feb 2021 02:58:39 GMT

This is really frustrating. I can't even use CTRL + F with the stock names to find the ones that have the unrounded decimals. Been trying to do this for hours to find 6 stocks. Every time you hit back it brings you back to page one.

Re: Wash Sale Loss Disallowed

Merry Widow — Thu, 25 Feb 2021 23:12:33 GMT

I've just gone through this with 7 of those "0" errors. When TT offers to correct the problems one by one, you have to scroll to the top of the form to get the exact name of the stock (including the beginning number). Then go back to the TT page that lists all your income. Go down to Investments and click edit. That will give you the list of all the stocks that were sold. Scroll until you find the one you want. Edit that. Eventually, you will find box 1g with the .49 or less entry. Delete it. Click Done. Unfortunately, you have to go back to the REVIEW section of TT to get the identity of the next problem entry. This is tedious, but it works!

Re: Wash Sale Loss Examples

SLYKTAX — Fri, 05 Mar 2021 16:25:10 GMT

I cannot find an answer whether it is a wash sale or not.

Let say, I bought 100 shares of ABC at $5,000 on 1/2/2020 and another 100 shares for $3,000 in 1/29/2020 (within 30 days). On 3/4/2020, more than 30 days from 2nd purchase, I sold the first 100 shares for $4,000. That $1,000 loss shouldn't be considered a Wash sale, correct? If I sold it for $4,000 on 3/1/2020 which is less than 30 days from second purchase, that is Wash Sale?

Re: Wash Sale Loss Examples

JohnB5677 — Sun, 07 Mar 2021 15:07:25 GMT

You are correct that if you sold a stock at a loss, and then re-purchased it within 30 days or less it would be a wash sale.

However, 1/29/2020 - 3/1/2020 is 31 days because of leap year.

This then qualifies it as a regular sale.

Re: Wash Sale Loss Disallowed

artu333 — Sat, 20 Mar 2021 19:30:41 GMT

So, I figured how to put the Total
Wash Sale Loss Disallowed. But now I need to report the (sales expenses not included on form). How do I do that? I put the total wash sale on the box, and it doesn't have other box to report those expenses. Should I substract it from the total wash sale?

Re: Wash Sale Loss Disallowed

JohnB5677 — Sun, 21 Mar 2021 13:42:26 GMT

The commissions that you pay when you buy and sell stock reduce your taxable income because they are added to your cost basis and deducted from your sale price by the broker.

Most other investment-related deductions are reported as miscellaneous expenses. Here are some common deductions:

Investment management or investment advisor’s fees (fees paid for advice on tax-exempt investments aren’t deductible)
Legal fees involving stockholder issues
Service charges for collecting interest and dividends

The tax laws allow you to write off certain investment-related expenses as itemized expenses on Schedule A.

Re: Wash Sale Loss Disallowed

artu333 — Sun, 21 Mar 2021 13:57:21 GMT

I did my math on some of them and it doesn't include borrow fees from shorting , that's why I'm asking.

Re: Wash Sale Loss Disallowed

DianeW777 — Sun, 21 Mar 2021 18:20:56 GMT

You include any costs in the transaction as part of your cost basis, it will still remain a disallowed wash sale if applicable. You must change the cost basis to reflect going short fee.

Re: Wash Sale question

SLYKTAX — Wed, 07 Apr 2021 18:40:01 GMT

I read the wash sale rule that says: you sell at a loss and within 30 days you bought back at cheaper price is Wash Sale.

Does that mean "Sell" need to come first before you buy them back within 30 days?

Will this be a Wash Sale if I bought XZY on 3 occasions, each time is within 30 days from the previous purchase. Then I sell the first purchase within 30 days of my last (3rd) purchase at a loss?

Re: Wash Sale question

AmyC — Wed, 07 Apr 2021 19:30:48 GMT

1. No, a wash sale is 30 days before or after. From the IRS, Publication 550 (2020), Investment Income and Expenses:

A wash sale occurs when you sell or trade stock or securities at a loss and within 30 days before or after the sale you:

Buy substantially identical stock or securities,
Acquire substantially identical stock or securities in a fully taxable trade,
Acquire a contract or option to buy substantially identical stock or securities, or
Acquire substantially identical stock for your individual retirement arrangement (IRA) or Roth IRA.

2. Yes, you sold within 30 days of buying identical stock. Pub 550 states:

If your loss was disallowed because of the wash sale rules, add the disallowed loss to the cost of the new stock or securities (except in (4) above). The result is your basis in the new stock or securities. This adjustment postpones the loss deduction until the disposition of the new stock or securities. Your holding period for the new stock or securities includes the holding period of the stock or securities sold.

@SLYKTAX this means that you will not be claiming the loss on your taxes this year but will add that to the basis of the stock that replaced it.

Re: Wash Sale Loss Disallowed

mmpint — Thu, 08 Apr 2021 12:30:27 GMT

Has this been fixed yet? After 20+ years of being a TurboTax user, I feel TurboTax has reached its limitations and is not addressing to modern day issues!

Re: Wash Sale Loss Disallowed

SForrestLO — Thu, 08 Apr 2021 16:28:25 GMT

@mmpint

Have you tried the steps listed above by @carolyn407?

Re: Wash Sale question

SLYKTAX — Thu, 08 Apr 2021 16:44:19 GMT

AmyC, I didn't get it as you have a "No" for #1, and a "yes" for #2.

Will this be a Wash Sale if I bought XZY on 3 occasions, each time is within 30 days from the previous purchase. Then I sell the first purchase within 30 days of my last (3rd) purchase at a loss? Yes or No?

Re: Wash Sale Loss Disallowed

DianeW777 — Sun, 11 Apr 2021 15:27:18 GMT

Until all of the stock is disposed of the wash sale rules apply. Any loss will not be allowed to offset other gains until you fully dispose of all the stock involved in the wash sale rules.

Continue to add the loss to the cost basis of the stock until you dispose of all of it.

@SLYKTAX