Tax lots, realized gains and wash sales

What it is

A lot-by-lot record from your fills: cost basis, each sale's gain or loss and term, every wash sale and its amount

What it changes

Nothing yet: it warns, it never blocks an order or changes what the desk buys

Where it shows

The day report's Taxes section today; a Portfolio panel and a line on order cards are coming

Method

First in, first out; one account; same ticker only. Bookkeeping for your screen, not a tax filing

This feature is decided and its bookkeeping is in this build; the screens that show it are not. Until they ship, the numbers are in the nightly day report (Review) and behind the API.

What a wash sale is, in one paragraph

Sell shares at a loss and buy the same ticker within 30 days before or after, and the tax rule treats it as if you never left: the loss does not count this year. It is not gone. It is added to the cost of the new shares, and their holding period starts where the old one did, so you get it back when you finally sell them. A book that trims, stops out and re-enters the same names every few weeks does this constantly without noticing, which is how an active retail account ends up owing tax on gains it did not keep.

What the book now keeps

Every buy becomes a lot with its price. Every sale uses up the oldest lots first and records, per lot, the proceeds, the cost, the gain or loss, and short or long term (long means held more than one year). When a sale at a loss has a purchase of the same ticker inside the 30-day window on either side, the matched part of the loss is marked disallowed, moved onto the replacement shares' cost, and listed as a wash sale with the dollar amount. The totals by year (short-term, long-term, disallowed) are the numbers a Schedule D cares about, computed the same way every night from the same fills.

The warning on an order

An order that would complete a wash sale carries a plain sentence before you approve it: buying a ticker you sold at a loss in the last 30 days ("about $200 of that loss becomes non-deductible this year; waiting until after 13 September avoids it"), or selling at a loss while shares you bought in the last 30 days stay in the book. A plain loss sale says by which date a repurchase would turn it into a wash sale. These are advisory: the order goes through if you approve it. Whether the desk should avoid such trades on its own (wait out the window, pick the highest-cost lot, harvest losses in December) is a decision for later, made with these numbers in front of you.