When I look at “Realized Gain/Loss Summary for 2022” from my brokerage I can see: - Short Term Gain/Loss +141.90 (this makes since, it’s the disallowed loss) - When I eventually sell the 4.812 shares in the future there’s a -113.12 Long term loss
This makes sense to me because the disallowed loss is accounted for. My current Gain/Loss for 2022 still shows that the 141.90 was disallowed. However, with our beancount examples my Income:US:Fidelity:PnL does not account for the 141.90 change after 11/15. - Income:US:Fidelity:PnL:Wash is 0 after 11/15 - Income:US:Fidelity:PnL was reduced by 141.90 on 6/16 but was increased by 141.90 on 11/15 Basically my only confusion is that even though I’ve sold the adjusted cost basis lot, I’m still under the impression that 141.90 should be a disallowed loss that should be represented somewhere. In our beancount examples, the values of the PnL accounts after 11/15 are at exactly the same values they would be at if we never adjusted the cost basis of the 4.812 shares. Colton > On Nov 26, 2022, at 7:17 AM, Robert Sesek <[email protected]> wrote: > > Once you acquire new shares, then the wash sale amount gets added to the cost > basis of the replacement shares. The Wash account should balance to zero in > that situation, because the disallowed loss amount is consumed by the new > shares' cost basis. There is no separate wash sale amount you report on your > taxes: on Form 8949 you report that a loss was disallowed because of a wash > sale. The disallowed loss gets applied to a future tax lot's cost basis, and > that is only reported when you ultimately sell those shares with the adjusted > cost basis. > > I would rewrite the last two transactions of your example differently: > > 2022-06-16 * "FXAIX" "Wash sale disallowed loss from 2022-07-01" > ; New back-dated transaction to disallow the loss, since the PnL cannot be > captured for tax purposes > Income:US:Fidelity:PnL -141.90 USD > Income:US:Fidelity:PnL:Wash 141.90 USD > > 2022-07-01 * "FXAIX" "Wash sale cost basis adjustment" > Assets:Investments:Taxable:IndexFunds:FXAIX -4.812 FXAIX {162.23 USD} > Assets:Investments:Taxable:IndexFunds:FXAIX 4.812 FXAIX {191.719 USD} > Income:US:Fidelity:PnL:Wash -141.90 USD > > 2022-11-15 * "FXAIX" "Sell" > Assets:Investments:Taxable:IndexFunds:FXAIX -4.812 FXAIX {191.719 USD} @ > 138.72 USD > Assets:US:Fidelity:IndexFunds:Cash 667.52 USD > Income:US:Fidelity:PnL 255.03 USD > > You are right that the date needs to be propagated, but if you make the > adjustment on the same day as the acquisition of the replacement shares, then > the implicit date works fine. However, you technically need to adjust the > cost basis date as well, to reflect the holding period adjustment that also > happens during a wash sale. > > - Robert > > On Saturday, November 26, 2022 at 2:35:35 AM UTC-5 [email protected] wrote: >> I think I’m missing something fundamental — a slightly simplified example of >> what I’m doing is provided below. >> >> I can get the final transaction to balance but at that point >> Income:US:Fidelity:PnL:Wash is back to zero. I know my brokerage is still >> tracking the wash sale though and wouldn’t I want to be tracking a non-zero >> value for taxes? >> >> Colton >> >> 2021-09-07 * "FXAIX Purchase" >> Assets:Investments:Taxable:IndexFunds:FXAIX 31.803 FXAIX {157.22 USD} >> Assets:Investments:Cash >> >> 2021-12-10 * "FXAIX dividend reinvestment" >> Assets:Investments:Taxable:IndexFunds:FXAIX 4.065 FXAIX {163.33 USD} >> Assets:Investments:Cash >> >> 2022-04-08 * "FXAIX dividend reinvestment" >> Assets:Investments:Taxable:IndexFunds:FXAIX 3.388 FXAIX {155.83 USD} >> Assets:Investments:Cash >> >> 2022-06-16 * "FXAIX Sell" >> Assets:Investments:Taxable:IndexFunds:FXAIX -31.803 FXAIX {157.22 USD} >> @ 127.73 USD >> Assets:Investments:Taxable:IndexFunds:FXAIX -4.065 FXAIX {163.33 USD} >> Assets:Investments:Taxable:IndexFunds:FXAIX -3.388 FXAIX {155.83 USD} >> Assets:US:Fidelity:IndexFunds:Cash 5,014.17 USD >> Income:US:Fidelity:PnL 1177.79 USD ; because of >> the next transaction this should be reduced by 141.90 >> >> 2022-07-01 * "FXAIX dividend reinvestment" ; this caused the wash sale >> Assets:Investments:Taxable:IndexFunds:FXAIX 4.812 FXAIX {162.23 USD} >> Assets:Investments:Cash >> >> 2022-07-01 * "Re-adjust cost basis due to Wash Sale" >> Assets:Investments:Taxable:IndexFunds:FXAIX -4.812 FXAIX {162.23 USD} >> Assets:Investments:Taxable:IndexFunds:FXAIX 4.812 FXAIX {191.719 USD} >> ; also suppose to propagate the date? >> Income:US:Fidelity:PnL:Wash -141.90 USD ; accounting >> for wash sale >> >> 2022-11-15 * "FXAIX Sell" >> Assets:Investments:Taxable:IndexFunds:FXAIX -4.812 FXAIX {191.719 USD} >> @ 138.72 USD >> Assets:US:Fidelity:IndexFunds:Cash 667.52 USD ; should match >> cash deposited from transaction >> Income:US:Fidelity:PnL 113.13 USD ; loss from the >> transaction >> Income:US:Fidelity:PnL:Wash 141.90 USD ; required to >> balance but results in zero'ing out PnL:Wash >> >> >>> On Nov 24, 2022, at 7:43 PM, Robert Sesek <[email protected] <>> wrote: >>> >> >>> I book wash sales similar to that example. Though I do adjust the >>> disallowed loss into a Wash account, rather than directly into PnL. >>> >>> What cost basis lot are you using to reduce the inventory when you sell the >>> shares? You need to use the adjusted cost basis for those shares. Here is a >>> hypothetical sale based on the example in irs-simple-example-1.beancount: >>> >>> 2014-01-01 * "Sell adjusted lots" >>> Assets:Investments:STOCK -100 STOCK {10.5 USD} @ 11.00 USD ; >>> Adjusted cost basis shares >>> Assets:Investments:Cash 1,100.00 USD >>> Income:Investments:PnL -50.00 USD ; PnL from the adjusted cost >>> basis >>> >>> Conceptually, the transactions are: >>> - Buy stock >>> - Sell stock at a loss >>> - Dividend reinvestment >>> - Cost basis adjustment of the reinvested dividend shares by the loss amount >>> - Sell reinvested shares, reducing the position by the lot with adjusted >>> cost basis >>> >>> If you are still having trouble, it would be helpful for you to post the >>> transactions you are having an issue with. >>> >>> - Robert >>> >>> On Thursday, November 24, 2022 at 4:55:46 PM UTC-5 [email protected] <> >>> wrote: >>>> I've been struggling with the *right way* to account for wash sales. I've >>>> been reading these: >>>> - https://github.com/beancount/beanlabs/tree/master/beanlabs/washsales >>>> - >>>> https://beancount.github.io/docs/how_inventories_work.html#augmentations-vs-reductions >>>> >>>> My situation is pretty simple: >>>> - bought some stock >>>> - a bit later sold some lots at a loss >>>> - automatic dividend reinvestment got me (oops) and this is what triggered >>>> the wash sale >>>> - few months later I sell the lot that triggered the wash sales >>>> >>>> I can adjust the cost basis of the lot that triggered the wash sale but >>>> the problem is that the new cost basis throws off my later transaction >>>> when I sell the wash sale lots. >>>> >>>> My case is exactly like this one: >>>> https://github.com/beancount/beanlabs/blob/master/beanlabs/washsales/irs-simple-example-1.beancount >>>> >>>> Except that after the last transaction there is one more transaction where >>>> I sold the lot with the adjusted cost basis and I can't get this to >>>> balance (even if I use an account like "Income:Investments:PnL:Wash" >>>> >>>> Any tips appreciated! >>>> >>>> Colton >>> >>> >> >>> -- >>> You received this message because you are subscribed to the Google Groups >>> "Beancount" group. >>> To unsubscribe from this group and stop receiving emails from it, send an >>> email to [email protected] <>. >>> To view this discussion on the web visit >>> https://groups.google.com/d/msgid/beancount/3f3f5550-598f-480d-958d-7545d6752a7bn%40googlegroups.com >>> >>> <https://groups.google.com/d/msgid/beancount/3f3f5550-598f-480d-958d-7545d6752a7bn%40googlegroups.com?utm_medium=email&utm_source=footer>. >> > > > -- > You received this message because you are subscribed to the Google Groups > "Beancount" group. > To unsubscribe from this group and stop receiving emails from it, send an > email to [email protected] > <mailto:[email protected]>. > To view this discussion on the web visit > https://groups.google.com/d/msgid/beancount/38a6e079-0bf1-4a77-b493-072705ee7fbdn%40googlegroups.com > > <https://groups.google.com/d/msgid/beancount/38a6e079-0bf1-4a77-b493-072705ee7fbdn%40googlegroups.com?utm_medium=email&utm_source=footer>. -- You received this message because you are subscribed to the Google Groups "Beancount" group. 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