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Wash-Sale Disallowed Loss Calculator

Estimate the disallowed and currently deductible portions of a tax loss under the wash-sale rule

Frequently Asked Questions

What is the wash-sale rule?

The wash-sale rule disallows a tax loss when you sell a security at a loss and buy a substantially identical one within 30 days before or after the sale.

Is the disallowed loss gone forever?

No. The disallowed loss is added to the cost basis of the replacement shares, so you recover the tax benefit when you eventually sell those shares.

How long is the wash-sale window?

The window spans 61 days in total: the 30 days before the sale, the day of the sale, and the 30 days after it.

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This calculator provides estimates for educational purposes only and is not investment advice. Past performance does not guarantee future results. Consult with a qualified financial advisor before making investment decisions. All investments carry risk, including potential loss of principal.

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How This Calculator Works

The wash-sale rule prevents you from claiming a tax loss when you sell a security at a loss and buy a substantially identical one within a short window. The portion of your loss that is disallowed is proportional to how many of the sold shares you replaced. If you repurchased as many or more shares than you sold, the entire loss is disallowed. If you replaced only some, a matching fraction of the loss is deferred.

The disallowed amount is not lost forever. It is added to the cost basis of the replacement shares, so you recover the benefit when you eventually sell those.

How To Use It

Enter the number of shares you sold at a loss, the total realized loss in dollars, and the number of shares you repurchased within the 30-day window. The result shows the disallowed loss and the portion you may currently deduct.

What Counts as "Substantially Identical"?

The IRS has not issued a precise definition of "substantially identical," which creates planning opportunities - and traps. The clearest cases and gray areas include the following.

Clear Wash Sales

Selling 100 shares of Apple stock and buying 100 shares of Apple stock within 30 days is an obvious wash sale. The same applies to call options or warrants on the same stock (buying a deep-in-the-money option gives essentially the same economic exposure as owning the shares). Convertible bonds that can be exchanged for the same company's stock have also been treated as substantially identical in IRS guidance.

Mutual Funds vs. ETFs Tracking the Same Index

Selling the Vanguard S&P 500 mutual fund (VFIAX) and immediately buying the SPDR S&P 500 ETF (SPY) is a gray area. Both track the same index but are different securities issued by different fund companies. Most tax professionals believe this does not trigger the wash-sale rule, though the IRS has not ruled definitively. The case is stronger when you switch to a fund tracking a different index (e.g., total market instead of S&P 500).

Spouse Accounts and IRAs

The wash-sale rule applies across accounts you or your spouse own, including IRAs and Roth IRAs. If you sell a stock at a loss in your taxable brokerage account and your spouse (or you) repurchases the same stock in an IRA within the 30-day window, the loss is disallowed - but in this case the disallowed loss is permanently lost, because it cannot be added to the IRA's cost basis (IRAs don't track basis in the same way). This is one of the costliest wash-sale traps.

Record-Keeping and Tax Filing

Tracking wash sales across multiple accounts requires careful record-keeping, because brokerages only report wash sales within a single account on the 1099-B they send you.

How the Disallowed Loss Adjusts Your Basis

When a wash sale is triggered, the disallowed loss amount is added to the cost basis of the replacement shares. For example, if you sold 100 shares at a $500 loss and bought 100 replacement shares at $20 each ($2,000 total), the adjusted cost basis becomes $2,500. When you eventually sell those replacement shares, the higher basis reduces your taxable gain (or increases a future loss), so the tax benefit is deferred, not eliminated.

Form 8949 and Schedule D

Disallowed wash-sale losses are reported on Form 8949 with code "W" in column (f). The disallowed amount appears in column (g) as a positive number that offsets the loss. Schedule D aggregates your net capital gains and losses. Your brokerage's 1099-B will flag same-account wash sales, but cross-account and IRA wash sales are your responsibility to identify and report.

Tax-Loss Harvesting Without Triggering Wash Sales

Tax-loss harvesting - deliberately selling positions at a loss to offset capital gains - is a powerful after-tax return enhancement, but it requires actively avoiding the wash-sale rule.

The 30-Day Waiting Period Strategy

The simplest approach is to sell the losing position, hold cash or a different asset for 31 days, and then repurchase the original security. The downside is 31 days of market exposure risk. If the stock rallies during the waiting period, the opportunity cost may exceed the tax benefit.

Switching to a Similar-but-Not-Identical ETF

A more practical technique is to replace the sold holding with a similar but distinct security immediately, maintaining market exposure. For example, selling the Vanguard Total Market ETF (VTI) and immediately buying the Schwab U.S. Broad Market ETF (SCHB) - two funds tracking different indexes with high correlation - should not trigger the wash-sale rule. Other common swaps include rotating between S&P 500 funds and total market funds, or between two large-cap value ETFs from different providers.

Harvest Only in Taxable Accounts

Tax-loss harvesting only generates a benefit in taxable brokerage accounts. Losses inside an IRA or 401(k) have no tax consequence because those accounts already defer or eliminate tax. Focus harvesting efforts on taxable accounts and be careful not to inadvertently create wash sales by coordinating with your tax-deferred account activity.

Tips & FAQ

Does a wash sale affect my IRA?

Yes - and in a particularly harmful way. If you sell a stock at a loss in a taxable account and then buy the same (or substantially identical) stock in a traditional or Roth IRA within the 30-day window, the loss is permanently disallowed. Unlike a wash sale in a taxable account (where the loss is deferred via a basis adjustment), there is no mechanism to recover a disallowed loss that involves an IRA repurchase. The loss is simply gone. This is a well-known but often overlooked trap for investors who actively manage both taxable and retirement accounts.

What if I sell and rebuy in a different account?

The wash-sale rule is applied on a per-taxpayer (and spouse) basis, not per-account. Selling in your taxable brokerage and rebuying in another taxable account, a traditional IRA, a Roth IRA, or your spouse's account within the 61-day window (30 days before through 30 days after the sale date) all count. Brokerages typically only track wash sales within a single account, so cross-account coordination is entirely your responsibility. Tax software like TurboTax or a tax professional can help identify these across-account wash sales before you file.