Does TurboTax handle cross account wash sale cost adjustments? What about wash sales when options of that stock are involved?

[TomYoung · Accepted solution]

"Does TurboTax handle cross account wash sale cost adjustments?"

No it does not.  TurboTax deals entirely with what's on the 1099-B and what you enter.

"What about wash sales when options of that stock are involved?"

Same answer.  If the wash sale situation isn't noted on the 1099-B TurboTax has no way of somehow "knowing" you're in that situation.

If you are in a wash sale loss situation and it's not on the 1099-B then it's your responsibility to report it.  The Form 8949 instructions tell you to enter a code of "W" in column (f) of the Form 8949 and the necessary adjustment in column (g).  Short of working in Forms Mode - only available in the desktop versions - there's no way to do that in TurboTax.  What I would do in this case is click on the blue "I'll enter additional info on my own" button and correct the basis on the following page.  That will put a code of "B" in column (f) of Form 8949 and the correct adjustment in column (g).  That gets your taxable income properly stated and if your income is properly stated the IRS simply can't bust your chops over an incorrect code.

Tom Young