Wash Sale Disallowed on TurboTax - Numbers Not Matching

Thanks for explaining! I found the Adjustments section but I'm still confused. The total capital gains amount is actually different by about $340 between what my 1099-B shows and what TurboTax calculated. Is there a way to override what TurboTax is doing and just manually enter the exact numbers from my 1099-B instead?

Yes, you can definitely override the imported values. Look for the "Edit" button next to each transaction in the investment section. You can manually adjust the cost basis, sale proceeds, and wash sale disallowed amounts to match your 1099-B exactly. A $340 difference is significant enough to investigate. This could be happening because TurboTax might be correctly applying wash sale rules across multiple accounts if you have them, while your individual 1099-B only shows account-specific calculations. The IRS requires wash sale calculations to be applied across all your accounts, not just within single accounts.

Does taxr.ai work with multiple brokerages? I've got accounts with both Fidelity and Schwab, and I'm seeing wash sale discrepancies across both platforms when importing to TurboTax.

I'm a bit skeptical about using third-party tools with my tax documents. How secure is it? And does it actually integrate with TurboTax or do you still have to manually enter the corrected information?

Yes, it works with all major brokerages including Fidelity and Schwab. It's actually designed to help identify cross-account wash sales which are often the biggest source of calculation errors. It's extremely secure - they use bank-level encryption and don't store your documents after analysis. It doesn't directly integrate with TurboTax, but it gives you a detailed report showing exactly which numbers need to be corrected. I found it much easier to make the manual adjustments with their guide rather than trying to figure it out on my own.

Wait how does this even work? They just sit on hold for you? Is this legit or some kind of scam? Seems too good to be true tbh.

I'm super skeptical. I've heard TurboTax doesn't actually have proper support for complex wash sale issues anymore. Did they actually solve your specific problem or just give generic advice?

They basically use an automated system that waits on hold and then calls your phone when a human actually answers. It's completely legitimate - they don't ask for any personal information beyond your phone number to call you back. They connected me with a TurboTax tax specialist who absolutely knew what he was talking about regarding wash sales. He remotely accessed my return and showed me exactly which transactions were causing the discrepancy. The issue was related to how the broker was reporting cost basis for partial lots with wash sale adjustments. The specialist manually corrected several entries and showed me how to fix the rest.

Is there any official guidance on what counts as "substantially identical" for wash sales? I trade different semiconductor ETFs and I'm never sure if they would trigger wash sale rules since they track different indexes but have many overlapping holdings.

That's part of the problem - the IRS hasn't provided super clear guidance on what exactly constitutes "substantially identical" securities. The classic definition is that they're securities that are basically interchangeable or have the same rights and privileges. For ETFs specifically, most tax professionals consider funds that track the same index to be substantially identical (like SPY and IVV). For sector ETFs like semiconductor funds, it's more of a gray area. If they track different indexes and have significantly different compositions, you can probably argue they're not substantially identical, but there's always some risk the IRS could disagree.

I tried that last year and it worked great! Just go to the investment income section, choose "Enter on my own" instead of import, and select the summary option. As long as your 1099-B has the summary totals clearly stated (Box 5 on most forms), this satisfies IRS requirements.

Thanks! That sounds much easier than trying to reconcile hundreds of individual transactions. My broker's 1099-B does have clear summary totals in Box 5, so I'll try this approach. Would be so much simpler than spending hours trying to figure out why specific wash sale calculations don't match.

Omg this might be exactly what's happening! I did sell some losers in late December and then bought back some positions in January when I got my bonus. So TurboTax might actually be correct and my broker's 1099-B could be missing these cross-year wash sales?

Exactly! This is a common situation that causes these exact discrepancies. The IRS wash sale rule definitely applies across tax years, but brokers can only report transactions that occurred within the calendar year on your 1099-B. So if you sold at a loss on December 28, 2024, and repurchased on January 5, 2025, that's 100% a wash sale according to IRS rules. Your broker might not flag it on your 2024 1099-B because the repurchase happens in the next reporting year. TurboTax, however, is correctly looking at your full transaction history across the year boundary and applying the wash sale rule properly. In this case, TurboTax's calculation would be the correct one to use on your tax return!