Submitted by maidog6 t3_127af3d in wallstreetbets
Proceeds: 2,121,495.69 Cost Basis: 2,187,608.44 Wash sale Loss Disallowed: 61,492.95
Net Loss: -4,619.80
I know I suck at day trading. Just want to understand this a bit better. I only started with about 30k in my account and clearly lost 4,619.80. These wash sales make it complicated for me. Will I still pay taxes even though I have no gains? If someone can elaborate on my wash sale loss disallowed I would appreciate it so much.
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>Yes, you will still have to pay taxes on your net loss. The wash sale rule exists to prevent people from artificially inflating their losses in order to reduce their tax liability.
How do i pay taxes on a net loss though? I gotta pay for losing money?
In US, you can deduct investment losses up to a limit on your return. It can potentially reduce your tax burden.
Dm
with negative dollars
[Expletive deleted]
Oh my gourd!
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Im in the US. So how much would I owe if I lost 4,619. I have no gains. So I have to pay taxes on losing money.
lmaoo. thats how im seeing this.
Fuck sorry I’ll delet this in regard
No. You’d likely owe nothing and have a carryover loss to apply to next year’s gains. But you still have to file the taxes showing you owe nothing.
ah ok. thanks for letting me know this. i appreciate that
How....
I was going to say wtf then I remembered where I was
You don't pay taxes on losses. You pay taxes on gains since you clearly do not have.
oh ok. like that makes sense to me, but Laws and regulations are always so complexed. I just never know these days lol sorry
So you were playing with over $2 million and only managed to be in the red $4.9k?
Am I missing something, I thought you said you started with $30k?
Find a good tax accountant, it's worth paying for.
yea your missing something lol. that 2 million is all my dumb day trading added together some kind of way.
That’s just the sum of all their trades, cumulative. Not an actual balance or funds available number.
You belong here.
no lies detected
The bot has spoken
The loss on sale (subject to wash sale rules) is added to your cost basis of the subsequent purchase that will trigger the rule into play. It’s to prevent manipulation for offsetting gains in a given year, resulting in a decrease of tax liability. You will recognize the loss on your wash sale when you sell stock without repurchasing in a 30 day window.
Regard, find a turnkey tax preparing agency like HnR block. Then listen to their advice. It's likely a magnitude better than what you'd get here.
You can write off 3k in losses per year. The leftover amount is put onto the next year.
The net loss is the only number you really need to know. You can deduct $3,000 against your income and carry the rest over to deduct next year.
Wash sale Loss Disallowed happens when you sell at a loss and buy the same thing again within 30 days (before or after). It means that loss doesn't count for taxes, but if you sell the position later (for more than 30 days) you get the loss back again (because the amount that was disallowed before gets added to the cost basis).
Did you not put calls on the Deluxe Edition of TurboTax this year?
Lol thanks for clarifying
[deleted]
You’re clearly doing better than most of us here so there’s that.
$2000000 and you come here for tax advice??? Fuck off and pay am accountant ... you'll get the answer you need and sleep
Nah that’s just the sum of the trades. When I was a degen in 2021 I was playing around with 5K but my proceeds and basis went up to 18k just because of constant trading.
Did you really just make a post to claim you have a 2 million $ trading account? No one gives a fuck son, don't try to tell us you have 2 million yet don't know what capital gains/ loss is you idiot
He has yet to fear tax men.
I've been throwing out these 1099 papers for years.
... Lol, holy shit. Just when I think you couldn't possibly be any dumber you go and do something like this..... AND TOTALLY REDEEM YOURSELF!
You dumbass.
Nobody in this sub pays taxes…on their trading anyway
What happens when you reach 1100 papers?
Bots an a hole lmao
When you don't know, you go and build a castle on that ignorance and celebrate the regardedness
Now I understand why my accountant always asks me to add all my trades up. It's always some dumb number.
You don't want to know this ...
Not only that but you can claim the loss! Looks like you’re the real winner after all.
Unprofitable day trader is tautology
Dude an accountant only costs a couple hundred bucks stop asking Reddit for tax advice unless you want to end up like Wesley Snipes
I hate myself for laughing at this.
How did you turnover your full portfolio 70 times?
“Portfolio”? Is that what you call the dirty wad of cash you take to the casino?
4600 is after wash sale or before? Sounds like before, so you my friend have a gain of around $56k. If no other income, you will likely pay maybe 10k in taxes between all. Congrats on a gain!
You belong here!
Oh yes I no
Living the Snipes Life
Most of the time they’ll add your wash sale back to the cost basis, unless you sold your loss position at the end of the year and rebought it. Just chill and record your capital loss on your 1040 and deduct 3k this year, carry forward the rest to next year
The above states that you bought 2,187,608.44 in securities and sold them for a loss at 2,121,495.69. If you did not have any wash sales, then this would yield a loss of 2,121,495.69 - 2,187,608.44 = -66,112.75 Wash sales are treated as additional profit and therefore decrease the net loss. Thus, the net loss you are eligible to claim is -66.112.75 + 61,492.95 = -4,619.80 Unfortunately, this is above the 3,000 maximum per year that you are allowed to claim. You should be able to carry, the remainder of the loss forward to next year.
As others have stated, a wash sale occurs whenever you sell a security for a loss, but then repurchase it within 30 days. In these cases, the amount of the loss from the sale is applied to your new cost basis and is treated as a profit for tax purposes. For e.g., if you purchased 100 shares of a stock at $5 for $500, sold them for a $200 loss at $3 a share, and repurchased 100 shares at $1 a share for $100 within 30 days of the sale, you will not be able to claim the initial $200 loss. Instead, your cost basis on the 100 shares purchased will be $100 + $200 = $300 or $3 per share. Only once you sell those shares, will you be able to realize the loss based on the adjusted cost basis.
That said, you clearly do a lot of trading. As such, you should probably consider using a broker that allows specific share identification for shares sold. The IRS assume that if you do not specifically identify shares sold, that you are selling them in a FIFO (First In First Out) method. For e.g., if you buy 100 shares at $5, then buy 200 more shares at $2, and sell 200 shares at $3, the IRS will assume that you sold the initial 100 shares bought at $5 with 100 shares bought at $2 which would yield a net profit/loss of -$100. If you were specifically identifying shares sold, you could sell 33 shares from the 100 bought at $5 with 67 shares bought at $2 for a $1 profit. Note: with the FIFO method, you would incur a wash sale if you bought some more shares later.
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0 profit 0 taxes 😂
Bazinga
You turned 30k into 2.1 mil and lost it all back? How are you not on your way to the hardware store to get some rope?
Oh my gourd!
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I think the max you can claim of loss on your investments for taxes is $3k
Complexed Laws and regulations for an individual who certainly has a complex of his own.
Your loss can be used to offset gains
It’s actually very easy to do your taxes when you don’t make any money.
You only lost $4 k. Could have been much, much worse...write it off and try again.
...now someone post some real loss porn, I'm not getting hard looking at this shit.
I only lost 2k this last year cuz u lost so much the year before. I’ll take it as a win
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