I have an "undetermined transactions" section on my 1099-b for a sale of the entire position of a given stock in Dec 2022 and am trying to figure out how to calculate the cost basis for it (USA federal income taxes)

There had been multiple wash sales leading up to this sale, some of which go back to 2021 (but there wasn't another re-purchase after the Dec sale). I'm using LIFO for stock sales, but not sure if that maters here since the whole position was closed and wash sales tack on the holding time? Does this sound correct?

2021 - starting 200 shares
02Dec sold 100 shares, box 1g shows $500 disallowed loss
03Dec buy  100 shares
19May sold 200 shares, box 1g shows $800 disallowed loss
31May buy  200 shares
19Jul sold 100 shares, box 1g shows $600 disallowed loss
22Jul buy  100 shares
16Nov buy  400 shares
13Dec sold 600 shares, No gain/loss/basis info on 1099-b

Does the 1g value in the first 2 sales essentially not mater, because each was part of the cost basis used to calculate the next loss? And then to calculate my new cost basis for the final sale I take the cost of the 400 shares bought Nov 16 + the $600 loss? I assume 200 shares of the final sale need to be listed as long term gains and the other 400 short term, but how do I split the cost basis up between them?


1 Answer 1


Yes, each of those is a wash sale because you sold for a loss and re-bought within 30 days. In fact it demonstrates the purpose of the wash sale rule, as you were not allowed to claim a loss in 2021 without changing your overall position.

So the cost basis for the 200 shares bought before the 2021 sales has not changed; the losses that were deferred until you either sell those shares for a gain or without an offsetting buy. You would then use the cost bases for the next 100 shares bought and 300 of the next 400 shares in your 600 share sale.

If the 600-share sale were for a loss, then it would also be a wash sale for 400 of those shares, since you bought 400 shares within 30 days of the sale.

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