™Stock Market University · Research, Taxes & Investor Operations
Partial Wash Sales and Multiple Lots
Understand the idea. See the connections.
Learn how replacement quantities can disallow only part of a loss and why share matching matters.
The idea to understand
Match replacement quantities to loss-sale lots and allocate disallowed loss when only part of a sale is replaced.
The explanation
The essentials, explained.
Follow the idea, then work through an example. Pause at the self-check whenever you are ready.
One order can contain several tax lots
A broker confirmation may show one sale while the tax record contains multiple lots. Cost-basis method and lot selection can change which shares produced the loss before the wash-sale test is applied.
Optional context & practice
Why this matters
Only matched quantities can carry a specified adjustment in a partial example. A whole-position average can hide different lot treatment.
Useful vocabulary
Tax lot: A specific group of shares or units acquired in one transaction, with its own acquisition date and basis. Replacement shares: Shares acquired that are evaluated as potential replacements in a wash-sale analysis, subject to timing and substantially-identical requirements. Adjusted basis: An investment’s original tax basis after required increases or decreases, including certain wash-sale adjustments.
Equal-loss illustrations are not a universal pro-rata rule
A uniform $10 loss per sold share lets a 40-share match defer $400. With different lots, the actual matched shares and their losses determine the adjustment. IRS guidance orders replacement matching by acquisition. Identify the disposed lots first, then trace the matching and basis adjustments. Selling an entire position does not erase a prior wash-sale adjustment; its release or further deferral depends on the full transaction chain.
Try it with a hypothetical example
Create separate rows for each sale and acquisition lot. Match quantities in the documented order and preserve both matched and unmatched basis records.
A question to think through
One sale contains loss lots with different per-share losses. Can you multiply the total sale loss by a replacement-share percentage without reviewing matching?
Compare your reasoning
Not reliably. The uniform-loss shortcut can be wrong; use actual disposed and replacement lots and the applicable matching rules.
A moment to reflect · optional
What two records are essential for a partial wash sale?
Think through your answer, then compare it with the explanation.
Reveal the explanation
Share quantities and the per-lot basis/loss, together with acquisition and sale dates.
Saving is optional and stays in this browser. This does not complete a learning journey or assess investing ability.
Sources & editorial notes
Reviewed 2026-10-13 · My Market Book editorial team. Examples are hypothetical unless identified as historical. General education, not a personal investment recommendation. Next scheduled review: 2026-11-12, or earlier after a material change. Rule and product sensitive.