Wash Sale Rule Checklist
A loss sale is not automatically a usable tax loss. Before treating tax-loss harvesting as after-tax alpha, check whether a replacement trade falls inside the wash sale window, whether the asset is stock or securities, whether the replacement is substantially identical, and whether Form 8949 needs a code W adjustment.
Last reviewed: June 16, 2026
Four checks before modeling a harvested loss
Loss sale first
The rule starts with a sale or trade of stock or securities at a loss; a gain sale is not a harvested tax loss, and non-security assets need separate rules.
30-day window
Investor.gov describes a wash sale when substantially identical securities are acquired within 30 days before or after the loss sale.
Replacement exposure
IRS Publication 550 includes substantially identical stock or securities, contracts or options to acquire them, certain spouse or controlled-corporation purchases, and IRA or Roth IRA purchases in the review path.
Reporting match
IRS Form 8949 instructions use code W for a nondeductible wash sale loss and put the nondeductible amount as a positive adjustment in column (g).
Wash sale review workflow
Confirm that the sale produced a loss on stock or securities
Publication 550 frames the wash sale rule around stock or securities sold or traded at a loss. Do not use this checklist to decide unrelated asset classes without checking the source rules for that asset.
Open source: IRS Publication 550Scan the 61-day replacement window
Investor.gov says a wash sale occurs when securities are sold or traded at a loss and, within 30 days before or after the sale, the investor buys or otherwise acquires substantially identical securities or a contract or option to buy them. Treat the sale day as the center of the review window.
Open source: Investor.gov wash sales glossaryCheck replacement trades across more than the same account
Publication 550 says the wash sale rule can also apply when a spouse or a corporation controlled by the taxpayer buys substantially identical stock or securities. It also lists IRA and Roth IRA acquisitions as a separate trigger path.
Open source: IRS Publication 550Do not treat broker reporting as the whole rule
A Form 1099-B or substitute statement can help populate Form 8949, but Form 8949 instructions also tell taxpayers how to correct the nondeductible wash sale amount when the broker-reported amount is wrong.
Open source: IRS Instructions for Form 8949Carry the disallowed amount into basis when the rule says to
Publication 550 says a disallowed wash sale loss is generally added to the cost of the new stock or securities and the holding period carries over, except for the IRA/Roth IRA case described in the same rule list.
Open source: IRS Publication 550Reconcile the final sale on Form 8949 and Schedule D
The IRS says Form 8949 reconciles amounts reported to the taxpayer and IRS on Form 1099-B, Form 1099-DA, Form 1099-S, or substitute statements with the amounts reported on the return, and the subtotals carry to Schedule D.
Open source: IRS about Form 8949
Official sources used
Investor.gov wash sales glossary
Defines the 30-day before-or-after replacement window and the core substantially identical securities trigger.
IRS Publication 550
Explains wash sale triggers, basis and holding-period effects, related-party paths, options, short sales, dealers, and exceptions.
IRS about Form 8949
Explains that Form 8949 reconciles broker-reported capital-asset dispositions with return reporting before Schedule D aggregation.
IRS Instructions for Form 8949
Explains code W and the positive column (g) adjustment for a nondeductible wash sale loss.
Wash sale FAQ
Is the wash sale window 30 days or 61 days?
The source rule is 30 days before or after the loss sale. In practice, investors often review a 61-day span: 30 days before the sale, the sale date, and 30 days after the sale.
Does a broker's Form 1099-B catch every wash sale?
No. Broker reporting can help, but it may not see every account, spouse, IRA, or controlled-corporation fact pattern. Form 8949 instructions still put the final correction workflow on the return.
What happens to a disallowed loss?
Publication 550 says the disallowed loss is generally added to the cost basis of the replacement stock or securities and the old holding period carries over, except for the IRA/Roth IRA case in its rule list.
This page is general investor education, not tax advice, legal advice, filing advice, or a recommendation to harvest losses. U.S. federal tax results can depend on account type, spouse or controlled-corporation activity, IRA purchases, options, short sales, broker reporting, basis records, state rules, and the taxpayer's full return.
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