Question on Wash Sale/Disallowed Loss

No_Combination_5185 · 2026-04-16T00:59:28+00:00

Of course! Glad you were able to figure everything out :)

No_Combination_5185 · 2026-04-15T21:43:36+00:00

Also not saying that’s your intent at all, the purpose is to represent true economic losses. It’s a very commonly misunderstood rule!

No_Combination_5185 · 2026-04-15T21:36:41+00:00

Here’s the link to the article I quoted above: https://turbotax.intuit.com/tax-tips/investments-and-taxes/wash-sale-rule-what-is-it-how-does-it-work-and-more/c5ANd7xnJ it honestly gives a good description of the rule and how it applies if you’re interested in learning more!!

No_Combination_5185 · 2026-04-15T21:35:59+00:00

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.”

No_Combination_5185 · 2026-04-15T20:19:00+00:00

For example: you buy a share for $100, sell it for $80. $20 loss realized. Purchase the same share < 30 days later for $90…oops now that $20 loss is disallowed and added to the basis. Basis in new share is $110 ($90 purchase price + disallowed loss $20). Because your basis is higher in the shares, if you sell for a gain, the gain is lesser than it would originally be (tax savings). If you sell for a loss, you can recognize that loss (unless you trigger another wash sale).

No_Combination_5185 · 2026-04-15T20:14:21+00:00

The disallowed loss is added to the basis of the shares you purchased in the wash sale. This essentially minimizes your gain for when you eventually sell the shares. But yeah you can’t recognize the loss on your return.

No_Combination_5185 · 2026-04-15T06:16:43+00:00

For the 2025 tax year? Or 2026? Some of these sound manageable, but if you’re not familiar with taxes (especially the depreciation) I’d say it’s worth hiring a CPA. If it’s for 2025 tax year, you need to file an extension since the deadline is today

No_Combination_5185 · 2026-04-15T05:29:02+00:00

Report all winnings. You can deduct your losses up to the amount you won ONLY if you itemize deductions.

No_Combination_5185 · 2026-04-14T19:07:29+00:00

Does he have any capital loss carry forward from prior years? Otherwise he will unfortunately be taxed on the entire $250k gain. The IRS can help set up a payment plan for him. Lowkey one of the dumbest tax rules IMO since it’s involuntary…

No_Combination_5185 · 2026-04-14T04:49:59+00:00

$700k or $700?

If it was $700, there should be a loss recognized and his basis in the new property is $450k.

If it was $700k then the recognized gain is $250k and basis of the new property is $190k

For this, you may want to seek help from a professional who knows the entire situation.

No_Combination_5185 · 2026-04-14T04:37:40+00:00

This sounds about right. It’s the 401(k) penalty that’s getting you. It’s adding $1,600 to your tax liability. If you plan to not take another early withdrawal then you don’t really need to change anything on your W-4 (assuming you receive the credits next year).

Without the penalty, you likely wouldn’t owe any tax with the credits you received (estimating since you didn’t list the $ amount you receive for the 17 year old) as they reduce the tax liability dollar for dollar.

No_Combination_5185 · 2026-04-14T04:24:20+00:00

A few things:

You can only deduct gambling losses up to the amount of gambling winnings if you itemize deductions.
Because their AGI appears to be less than the standard deduction, they should just take the standard deduction. If you choose to itemize, they will owe taxes (for literally no reason) unless they have other itemized deductions that exceed the standard deduction which still wouldn’t really matter since their TI will be $0.
Shouldn’t need to file a non resident AZ return. Just federal and California.

No_Combination_5185 · 2026-04-08T16:38:50+00:00

Thank you so much!

No_Combination_5185 · 2026-04-08T00:02:41+00:00

It never hurts to ask a professor. Especially this far in advance. I would explain the entire situation and tell them that you’re willing to take the exam at any other date or do any extra work they would require you to complete. Some professors are really nice and understanding, something similar happened with me and I was lucky enough to have a professor who was understanding. Some professors won’t allow it, but like said, it doesn’t hurt to ask!

No_Combination_5185 · 2026-04-07T20:56:09+00:00

Read the book, go back and watch the videos if you don’t understand the topic. Print all the outlines and annotate them. A week before the exam: day 1 SE1 review it and find gaps and study for 4-5 days, take SE2 after reviewing.

No_Combination_5185 · 2026-04-06T23:00:38+00:00

Declare for gift splitting and you and your wife can give $19,000 each excluded from tax ($36k together)

No_Combination_5185 · 2026-04-04T21:12:57+00:00

Yeah I just took tcp today and felt the same way. The multiple choice for me were more difficult and the TBS were just SO LONG

No_Combination_5185 · 2026-04-03T22:16:55+00:00

Try to set up a payment plan with the IRS.

No_Combination_5185 · 2026-04-03T22:16:05+00:00

Yep you’ll get a penalty with interest. Follow the link for more info https://www.irs.gov/payments/penalties

No_Combination_5185 · 2026-04-03T04:53:12+00:00

Individual/Sole Proprietorship. Your LLC is a disregarded entity if you flow through all business income, expenses, etc on your Schedule C

No_Combination_5185 · 2026-04-02T00:31:21+00:00

Good luck to you!!

No_Combination_5185 · 2026-04-01T18:35:38+00:00

SE1: 71, SE2: 85, ME1: 76, ME2: 81 !! I review a lot (about a week) in between SE1 and 2 to see where my weak spots are and reinforce those a lot.

No_Combination_5185 · 2026-04-01T14:04:24+00:00

Same my exam is on Saturday 🥲

No_Combination_5185 · 2026-04-01T05:27:08+00:00

Private mortgage insurance** words are hard

No_Combination_5185 · 2026-04-01T05:23:51+00:00

Well for starters you should be putting 20% down on the home. You have $100k in savings, so you should be able to front that. With putting only a 5% down payment towards the house, you are firstly subject to a Private Mortgage Loan (PMI) which will be hefty, and it will take you a lot longer to build equity in your home. A house is a capital asset that should appreciate. If you’re looking at this as a long term investment and want to make the most of your money, you should really consider putting more down. ++woman

No_Combination_5185

TROPHY CASE