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Pastimes : Investor Accounting

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From: HIA3/2/2015 4:01:58 AM
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Well, there have been so many changes to the Schedule D and Form 8949 that the previous posts on the subject are now out-of-date.

Here's my most recent experience:

Forms 1099 and 8949 .

I'm sure everyone is up to date on the new 1099 and 8949 forms. Well, the very first year of a form 8949 caught me by surprise and I missed the public comment period.

Now this year, I don't see same day wash sales that previously just resulted from selling a total holding with one limit order.

But this year, security transactions that have the basis reported and that don't have adjustments can just be totaled directly on the Schedule D and are not required to be reported on the form 8949. So that makes it double easy ?

Well, here are two notes based on my experience with tax year 2014 1099 composite forms:

An options assignment where the underlying security is called away at the option strike price, has the option premium that was received just added to the security proceeds. So that's easy as well except that there is no note, no code, and no adjustment amount. The whole operation is done for the investor on the 1099 but the investor doesn't know that its been done. But I assume that the (reported) transaction doesn't go on a form 8949 because there is no adjustment amount listed. (There was a "Net Proceeds" note.)

And then a non-dividend-distribution adjusts the basis of a security position. Also, easy, but there is no note, no code, and no adjustment amount. The operation is done for the investor on the 1099 but the investor doesn't know that its been done. And I assume that this (reported) transaction doesn't go on a form 8949 because there is no adjustment amount listed. (There was a footnote that said that a basis might have a return-of-capital adjustment.)

Now certain securities, such as ticker GLD, are not fully reported and therefor must go on a form 8949. And so there may be some investors who have hundreds or thousands of transactions like this.

But this year I used the supplemental application for making a Form 4797 output and I used the output just as a means of checking the Schedule D.

kbhscape.com

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