Hi, thanks for contributing to this thread. I'm new to this, and just realized that I have the same problem - wash sales across more than one account. Could you clarify, what you mean by "get flat" in a security before December, and why does this solve the problem? My understanding that the wash sale loss can never be claimed as a loss.
Nope, your gains and losses inside a year all net out. It's only an issue if it spans a year, since taxes are calculated on what happened in the previous year. Given that the law covers sales "ending 30 days after" the sale date, as long as your last sale was 30 days before the end of the year you'll never run afoul of the wash sale rule.
THanks; are you saying that if I sell all offending stocks at the end of the year, I can claim wash sale losses on my tax return, even though the brokerage tax statements will still clearly identify these sales with a "wash-sale-disallowed" flag???
No, that's not correct. We've said if you go flat (no long or short positions) 30 days before the end of the year, not at the end of the year, you can ignore the rule. That distinction is vital.
Sorry for not being clear. I plan to get flat on November 30th and not trade those securities any more until the following year. How/why does this allow me to claim wash sale losses for the year, which IRS seems to disallow?
If you are flat for 31 days (i.e., December), then you have broken the chain of wash sales at that point for every security that you are flat. Therefore, you will not be carrying a wash sale over from one year to the next. Therefore, you can safely assume that your tax calculations will be equivalent to the scenario where you had no wash sales for the year (even if you did have intra-year wash sales). As to how you want to report this, I would just follow your broker's 1099 statement. They might show wash sales intra-year but those wash sales will be accounted for properly by year end when you get flat. Either way, your tax results will be the same.