Wash Sale Loss Disallowed

[AmyC]

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:

1. Buy substantially identical stock or securities,

2. Acquire substantially identical stock or securities in a fully taxable trade,

3. Acquire a contract or option to buy substantially identical stock or securities, or

4. 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.

[mmpint]

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! 

[SForrestLO]

@mmpint

Have you tried the steps listed above by @carolyn407?

[SLYKTAX]

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?

[DianeW777]

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

[mmpint]

Sorry but i cannot find any input from @carolyn407 in this thread. Can you resend or copy and paste? 

[JohnB5677]

carolyn407

#5915037

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!

This was carolyn407 post

@mmpint