taxes on wash sale disallowed if net loss is greater

Forum|Forum|2 years ago
February 14, 2024
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Hi, My Net loss is around $20,000 and my wash sale disallowed is around $7,000 so does that bring me to a $13,000 total loss or will I still owe taxes on 7k even though my loss is greater?

Mike9241

it's a question of whether you have net capital gains or net capital losses. the net is on line 16 of schedule D.

the wash sale disallowed losses are added to the tax basis of the substantially identical securities that caused the wash sale. so you get the loss benefit when those are sold in a fully taxable transaction (you do not again create a wash sale)

while line 16 may show a $13K loss only up to $3K may be used in 2023. the rest becomes a capital loss carryover to be used in future years.

kouav1Author

Ah I should have stated my brokerage is Robinhood and I don't manually eneter these so I have no clue as I just enter the tax form 1099b and it auto fills.

Wash Sale Disallowed = 7k
Net Profit = -20k

I know I am probably taxed on the 7k based on where my tax braket is unless im wrong but I also have 20k in losses so when I do file taxes then would it come out as around 13k in losses?