What do I need to do to exit the wash sale so the loss would have been allowed?

External question — Personal Finance Stack Exchange Author: SoonGuy Original post: https://money.stackexchange.com/questions/149109 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. This past year I started heavy day-trading of option contracts. I was aware of the wash sale rule... however when I received my 1099-B the wash-sale calculations are significantly different than I expected. One example of this is with BGFV . On my 1099-B the totals for BGFV are as follows... Proceeds: (-459.28) Gain/Loss: (-347.96) Wash Sale Loss Disallowed: 111.32 The below trades are the ONLY transactions against BGFV for the entire year. Note: observe that I opened a Short position on Calls # Timestamp Description Amount Commission Reg Fee 1 11/10/2021 10:09:49 Sold 1 BGFV Nov 19 2021 60.0 Call @ 2.4 239.34 0.65 0.01 2 11/10/2021 10:52:29 Bought 1 BGFV Nov 19 2021 60.0 Call @ 3.5 -350.66 0.65 0.01 3 11/11/2021 15:24:19 Sold 1 BGFV Nov 19 2021 60.0 Call @ 2.02 201.34 0.65 0.01 4 11/11/2021 15:29:57 Sold 1 BGFV Nov 19 2021 60.0 Call @ 3.24 323.34 0.65 0.01 5 11/11/2021 15:42:37 Bought 2 BGFV Nov 19 2021 60.0 Call @ 3.8 -761.32 1.30 0.02 Given the above information... Trades #1 & #2 (239.34 - 350.66 = -111.32) which is the same as my 1099-B shows as disallowed wash sale was triggered by trade #3 no wash sale triggered by trade #4 (wash sale only affected 1 contract) Question: On trade #5 when I sold my remaining 2 contracts why did I not exit the wash sale? The trades were placed in mid-November so there was more than 30 days after I exited the trade until the end of the year. I am confused as to why my 1099-B shows a Wash Sale Loss Disallowed of: 111.32. Can someone explain what I needed to do to properly exit the wash sale so the loss would have been allowed? I understand that buying the same security within 30 days before/after will trigger a wash sale. My understanding is the Cost/Basis is added to the next trade... so closing out the entire position should have resulted in the wash sale loss being allowed I do my own taxes and this is the 1st year I have ran into this... any help would be appreciated

External answer — Personal Finance Stack Exchange Author: Bob Baerker Original post: https://money.stackexchange.com/a/149115 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. Your analysis is correct. It was a wash sale and the carry forward loss was resolved when you exited the position completely and remained out of it for 31 days. My broker handles it the same way. The 1099-B only shows the disallowed loss. However, on the broker's 'Worksheet For Form 8949', it adds that so called 'disallowed loss' back in after subtracting the total Cost Basis from total Sales Proceeds. Do you have an 8949 form?