Wash sales of four years ago. Can I use them as extra added cost for stock transactions this year?

dansd1 · Feb 26, 2024 6:26:54 AM

I had a lot of wash sales occurred four years ago and I had never knowingly used them. I use TDAmeritrade. After electronically imported all the stock transaction data from TDAmeritrade every year, TurboTax automatically generated Form 8949. On Form 8949, there are details and summaries of disallowed wash sale loss on column (g). Please let me refer them as Disallowed Wash Sale Loss here so I can better express myself. To be exact, I had wash sale loss in year 2019, 2020, 2021, 2022, and 2023. If I do my tax return for year 2023 (which is tax report due by 04/15/2024, I will refer this tax return as Tax2023), can I use the Disallowed Wash Sale Loss incurred in year 2019 for Tax2023 please? If yes, can I add one extra transaction using the total of Disallowed Wash Sale Loss of 2019 as cost and using 0$ proceeds and claiming short term loss (to be safe) ?If no, will those Disallowed Wash Sale Loss of 2019 be useless for me forever? Experts, Please kindly help! I read a lot online here and there, but all readings point me to bigger headache. Yesterday I ran into a posting here, and I felt like this is a far much better place to learn on that. Please help! Stock trading ruined my life! Wash sale headache basically paralyzed me, made me unproductive on everything. I had used a well known professional tax service (chain store nation wide) long time ago once, but they manually input all transactions by hand and did not even mention anything about wash sale to me. After that, I do not trust those so called tax service any more. Plus, most recent years, transaction numbers are huge and it is almost impossible to handle the wash sales manually. I greatly appreciate your help!

You could reach out to TDA on this. Ask them what cost basis was adjusted for wash sale losses when the triggering options and underlying securities were sold and reported to you on a 1099-B. They should be able to point to the 1099-B where the cost basis was adjusted for this. Or, check the supplemental info with your 1099-B. TDA may have given the amount there.

If your losses were over a year ago, check your 1099-B from 2023 or 2022, to see if 'wash sales disallowed' are shown.

Here's more discussion on Reporting Wash Sale Losses.

@taxxat

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