Hi, I got the 1099-B from my broker for 2021. There are some disallowed losses due to wash sales. I only do day trading so I am flat at the end of each day. So why are there wash sales? What do I do with the disallowed losses? The 1099-B shows my total short term gains are more than the actual gains in my trading account. Thanks for your insight! Jzwu
Congrats! You have learned how the system is set up to fuck the little guy. To avoid wash sales in the future, stop trading everything you traded from Jan-Nov in Dec. (more or less)
But what do I do with the disallowed losses? Trade them again to realize the losses? But still the key question is how can wash sales happen for day trading, where all positions are closed by the end of each day? For example, I traded QQQ multiple times during the day with wins and losses. But if by the end of the day I am back in all cash with 0 positions, wash sale disallowed losses wouldn’t matter. Right?
I think I figured it out now. If during Jan. 2022 I traded the same stocks that I traded in Dec. 2021, that would trigger wash sale disallowed losses for 2021. However, I should be able to realize the disallowed losses in 2022. The losses will be realized in the subsequent year, postponed to 2022. BTW, the 2021 1099-B was generated on Feb. 11, 2022.
This info predates 2017. Wash sale loss adjustments https://www.dogpile.com/serp?q=wash+sale+loss+adjustments
Now with the disallowed losses on my 1099-B, can I still import my 1099-B into TurboTax for tax filing?