I have read past community discussions on Wash Sales for Pennsylvania (PA) taxes. I am still confused on whether to keep the entire loss on the PA Schedule D (which TurboTax automatically reports) and simply continue on to the next step in TurboTax versus adjusting the cost basis on my PA return. (I am re-sending this since I don't believe I received any answer.)
In my case, the wash sale occurred in a mutual fund. My 1099-B shows:
1d-Proceeds: $5,000 1e-Cost basis: $5681 1g-Wash Sale Loss Disallowed: $74 Realized Loss: ($607)
The PA Schedule D correctly allocates the $681 total loss between my spouse and me.
I have a NET CAPITAL LOSS regardless of this sale, so I don’t need this loss to offset a gain. In this case, what action do I take:
1) Do I make no adjustments, click on “Continue” and move on to the next Turbotax section? Does this action affect future year’s PA tax returns or is it fully reported with no future action required?
--OR--
2) Do I indicate “this sale requires an adjustment to the basis of the asset” and enter the wash sale disallowed loss of $74 in the basis adjustment box?
For full understanding, if I have a NET CAPITAL GAIN in the future, including the loss would help reduce the gain on my PA income. Would my actions change in this case?
Since the brokerage will adjust the cost basis for the mutual fund, I don’t believe I need to do anything further for federal purposes in either case (net capital gain or loss). Correct?
