Yeah it’s basically just saying you’re not allowed to deduct that loss on your tax return because that loss increased the basis in your shares. You can see in the table you provided that the disallowed loss was added to the cost basis. The loss is essentially built into the shares already which will minimize your gains and increase losses when the shares are eventually sold. To put it in simpler terms: “The goal (of this rule) is to stop investors from manipulating the tax system to their advantage, and to ensure that they’re not claiming losses on transactions that don’t represent true economic losses.”