If you have many stock wash sales and high trading volume, will the IRS audit you?

Created at Jul 23, 2026 13:13:54
149.**.48.86

114

Last year, I had a lot of wash sales and frequent trades, resulting in a Form 1099 that was 34 pages long, which my husband went through line by line to file our taxes

Because of this, we were audited by the IRS, and the school's financial aid office reportedly views it as suspicious.

My husband is extremely angry with me, claiming that my excessive wash sales and trading volume triggered the IRS's suspicion, but does this actually happen?

I had about 40,000 in my account, and after taking losses last year, I ended up with around 32,000 at the end of the year.

It wasn't a huge amount of money, and I didn't think my wash sales or trading volume were that excessive.

However, now that we are being audited, will this affect my child's college financial aid?

I am also cross-posting this in the college forum, but I would really appreciate your help. Thank you.

Tags: IRS Tax Wash Sales

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Comments 7

37.**.13.234 (Created at Jul 23, 2026 13:16:53) | Reply
The husband is the very exhausting type who needlessly creates trouble.
On top of that, he doesn't even know anything, yet he's picking on his wife.
They say if you just stay still, you'll at least go halfway...
Just pay him no mind and do it on your own.
The two of them are struggling over something even a kid could do.
You'd be better off just asking an AI and doing it.

144.**.9.163 (Created at Jul 23, 2026 13:16:23) | Reply
It's hard for a regular person who doesn't run a personal business to get audited. There isn't much to scrutinize. If it's true that he got audited, you should probably just pay an accountant to do it next time. But if your husband happens to be a consultant or a freelancer, it seems like he either didn't file his taxes properly or something else got flagged.

199.**.169.197 (Created at Jul 23, 2026 13:16:00) | Reply
No way. There is absolutely no reason for it to be triggered over $40,000.

129.**.153.189 (Created at Jul 23, 2026 13:15:34) | Reply
No, I do a ton of it too, but I've never been audited for that. And you don't have to enter them one by one; you can just enter the summary from the first 1-2 pages (in case of manual entry; otherwise, it automatically imports if you enter the account number and document number. I use TurboTax.)

62.**.204.17 (Created at Jul 23, 2026 13:14:41) | Reply
The audit probably wasn't triggered by this stock trading. It was a personal transaction, the amount was small, it was a loss, and it doesn't matter even if you buy and sell thousands of times. It is more likely that your husband didn't report his business income properly. Did you by any chance trade using your husband's company business account?

76.**.107.205 (Created at Jul 23, 2026 13:15:06) Like

If you used a US brokerage firm, the forms are generated automatically and reported to the IRS in the same way, so I don't think it would look particularly suspicious.

79.**.51.129 (Created at Jul 23, 2026 13:14:19) | Reply
I'm curious, why do you go through and check your tax filing one by one? If you just link your brokerage account to a program like TurboTax, it reports automatically, so it shouldn't matter how much buying and selling you do, right? Don't you just have to link it?

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