How to Report a Wash Sale on Your Tax Return: Form 8949 and Schedule D

To report a wash sale on Form 8949, enter the sale using the figures from your 1099-B in columns (a) through (e), put the code “W” in column (f), enter the disallowed loss as a positive number in column (g), and let column (h) show the adjusted result. That result then flows through to Schedule D with the rest of your capital gains and losses.¹

Check the 1099-B First

Before you touch Form 8949, look at Box 1g on the 1099-B your brokerage sent. If the broker identified the wash sale, the disallowed loss amount is already sitting there.² If Box 1g is blank but you know you triggered a wash sale, you’ll enter the adjustment yourself.

Brokers only flag wash sales they can see. Sell shares at one firm and buy the replacement at another, or trigger the rule with a purchase in an IRA, and the 1099-B will report a clean loss with nothing in Box 1g. Identifying the wash sale in that case is on you. Pull your trade confirmations from every account, note the dates and quantities, and check the 61-day window before you start typing.

Pick the Right Part of Form 8949

Form 8949 has two parts. Part I is for short-term transactions (held one year or less). Part II is for long-term transactions (held more than one year). Within each part, three boxes at the top separate transactions by whether the broker reported cost basis to the IRS and, if so, whether it appeared on your 1099-B. Choose the box that matches how your 1099-B reports the sale, because the totals feed different lines on Schedule D.³

Columns (a) Through (e): Copy From the 1099-B

These columns get the raw numbers, exactly as the broker reported them. Don’t pre-adjust anything here; the correction happens later.

Column (a): the security description (for example, “100 sh XYZ Corp”).
Column (b): the date you acquired the shares.
Column (c): the date you sold them.
Column (d): sale proceeds.
Column (e): cost basis.

Use the figures the broker reported even if you know you’ll be overriding them. The IRS matches the entries on 8949 against the 1099-B; changing (d) or (e) without a coded adjustment invites a notice.

Columns (f), (g), and (h): The Wash Sale Adjustment

Column (f) is the code column. Enter W to identify this line as a wash sale.¹

Column (g) is the dollar amount of the disallowed loss, entered as a positive number. If your realized loss was $1,000 and the wash sale rule disallows the full amount, write $1,000 in column (g).

Column (h) is the result of the arithmetic: proceeds (d) minus basis (e) plus the adjustment (g). Work a quick example. You bought 100 shares for $5,500 and sold them for $4,500, a $1,000 loss. You bought the same stock back inside the 30-day window, so the full loss is disallowed. Column (h) becomes $4,500 minus $5,500 plus $1,000, which is zero. No loss is deducted on this line. The $1,000 is not gone; it has been added to the basis of the replacement shares and will affect your gain or loss when you sell those.⁴

Partial Wash Sales

If you sold 100 shares at a loss but only bought back 75 inside the window, only the portion of the loss tied to those 75 shares is disallowed. The other 25 shares’ worth of loss is deductible normally. Put the disallowed portion in column (g); the loss on the unreplaced shares flows through column (h) as a real deduction. Depending on how your broker reported the transaction, you may need one line for the disallowed portion and a separate line for the deductible portion.

When the Broker Already Adjusted the Basis

If Box 1g on your 1099-B already contains a disallowed loss and the broker’s basis in column (e) reflects it, you may not need to enter anything separate in column (g). Transfer the broker’s figures across and check that column (h) produces the result you expect.

Verify the broker’s number against your own calculation before you rely on it. Brokers miss wash sales that involve other accounts, and they occasionally over-report. If the broker’s disallowed loss is wrong, put the correct figure in column (g). When your corrected number is smaller than the broker’s, attach a brief statement explaining the difference.¹

Move the Totals to Schedule D

Once every sale is entered, total each column and carry the results to Schedule D. Short-term totals from Part I go on the matching line of Schedule D (line 1a, 1b, 2, or 3 depending on which box you checked at the top of Form 8949). Long-term totals from Part II go to line 8a, 8b, 9, or 10.⁵

Schedule D combines short-term and long-term results on line 16. A net gain flows to line 7 of Form 1040. A net loss is deductible against ordinary income up to $3,000 ($1,500 if married filing separately), with anything above that carried forward to future years.⁶ Keep your 8949, Schedule D, and every 1099-B in your records in case the IRS asks.

One Situation Where the Loss Disappears

The reporting steps above defer your loss into the replacement shares’ basis, so you get it back later. That recovery breaks in one specific case: when the replacement shares are bought inside a traditional or Roth IRA (or a 401(k)). The wash sale rule still disallows the loss, but IRA shares don’t carry a tax basis you’ll ever use to recover it. The loss is permanently forfeited.⁷

Report it the same way on Form 8949: code W, disallowed loss in column (g), zero (or reduced) result in column (h). Just know that in this case, the deferral is really a disallowance for good. Check for automatic contributions or dividend reinvestments in your retirement accounts around any tax-loss harvesting date so you don’t create this situation without noticing.

1
Internal Revenue Service. 2025 Instructions for Form 8949
2
Internal Revenue Service. Instructions for Form 1099-B
3
Internal Revenue Service. About Form 8949, Sales and Other Dispositions of Capital Assets
4
Charles Schwab. Wash-Sale Rule: How It Works and What to Know
5
Internal Revenue Service. Instructions for Schedule D (Form 1040)
6
Internal Revenue Service. Schedule D (Form 1040) – Capital Gains and Losses
7
Internal Revenue Service. Publication 550 (2025), Investment Income and Expenses