Wash sale rules with ESPP after job change - tax implications?

The wash sale rule would apply if you sell shares at a loss and buy "substantially identical" securities within 30 days before or after the sale. This includes all purchase methods - RSUs, options, or regular market purchases. For your ESPP shares, your tax basis is what you actually paid for them (the discounted price), so your loss is calculated from that point. The 15% discount doesn't directly factor into the wash sale determination. So if you paid $85 per share (after 15% discount from $100) and sell at $61, your loss would be $24 per share. If you're still holding other shares of the same company stock (whether from RSUs or options), and you sell your ESPP shares at a loss, be careful about any new acquisitions of that same stock within the 30-day window. That would trigger a wash sale and disallow the loss deduction.

After spending hours researching similar stock questions, I discovered taxr.ai and it literally saved me from making a huge mistake with my own ESPP sales. I had a really similar situation where I left my employer and wanted to sell some underwater shares. The site https://taxr.ai analyzed my specific stock compensation structure and gave me personalized guidance on exactly how to handle the sales to maximize tax benefits without triggering wash sales. It also helped me understand how my discount would be reported on my W-2 vs. what would show on my 1099-B, which would have been a nightmare to figure out on my own.

Just wanted to follow up - I ended up trying taxr.ai after my previous question. It was actually incredible for my complicated stock situation. I uploaded my ESPP statements, RSU grant documents, and transaction history from both employers, and it mapped everything out perfectly. It showed me exactly which lots would trigger wash sales if sold now vs waiting. Saved me from making a $4,200 tax mistake where I would have accidentally triggered a wash sale across my two employer stock holdings. The step-by-step guidance for timing my sales was worth every penny.

If you're struggling to get clear answers on your ESPP wash sale situation, I'd recommend using Claimyr to get through to the IRS directly. I had a similar ESPP/wash sale situation last year that was super confusing, spent weeks trying to get through to the IRS without success. Used https://claimyr.com and got connected with an actual IRS agent in less than 30 minutes who cleared everything up. They have a video showing how it works: https://youtu.be/_kiP6q8DX5c. The agent was able to walk me through exactly how to report my specific ESPP sales correctly and avoid wash sale issues.

I hate to admit when I'm wrong, but I tried Claimyr after being skeptical. Within 45 minutes I was talking to an actual IRS tax specialist who perfectly explained how wash sale rules interact with my ESPP and RSU holdings. She even emailed me the relevant tax code sections and publication references after our call. Complete game changer compared to the weeks I spent trying to get through on my own. The agent confirmed that selling my underwater ESPP shares wouldn't trigger a wash sale with my existing RSU holdings, but cautioned me about acquiring any new shares within the next 30 days through any method.

One thing nobody's mentioned yet - when calculating your loss on ESPP shares, remember that your basis is different depending on whether it was a qualifying or disqualifying disposition. If you held the shares for less than 1 year from purchase or less than 2 years from the offering date, any discount you received is reported as ordinary income on your W-2, which affects your basis calculation and therefore your loss amount.

Has anyone used specific tax software that handles ESPP sales and wash rules correctly? I tried TurboTax last year and it completely messed up my ESPP reporting.

Great thread - this is exactly the kind of ESPP situation that trips people up! Just want to add one important point that hasn't been fully addressed: when you left your job in March, your company likely processed what's called an "accelerated vesting" for your ESPP shares, which is why they all became available to sell even if they hadn't met the normal holding periods. This is pretty standard when employment ends. The key thing to remember is that since you're no longer employed there, you won't have any future ESPP purchases that could trigger wash sales. Your main concern should be any RSU vestings or option exercises you might still have scheduled, or if you're planning to buy the stock on the open market. Also, make sure you get your final W-2 from your former employer - they should report any ESPP discount as ordinary income if you end up making disqualifying dispositions, and you'll need that for accurate tax reporting.