EZ to answer but for me....IRS related

Nov 8, 2019

I am the original poster to this thread and identified my purpose for it. My gratitude, explanations for it due to personal significance to me (not fully explained), and other, hopefully constructive comments I have listed below the line below. But I would rather present a few questions first should the reader of this current post miss them should they be otherwise at the end of this post. They generally are not as vital, but I am curious if in the event they should be important to a trader. Hey, this thread may become the Wikipedia of ET for this subject.

Question A: This one IS vital to me (In my case APEX): Can downloads from a clearing house be done in a manner to serve the purpose of a vendor like TurboTax´s ability to produce a product acceptable to the IRS as relates to trades ? Two reasons for asking this. Some posts at this thread have referred to downloads coming from their brokerage. I happen to trade with a brokerage that has no presentable web page for use with tax filing. None. Perhaps my posters are referring to their clearing house ? My brokerage refers traders with a link that takes me directly to APEX that includes the necessary information. Just what I need, right? But wait ! The info on trades is what is necessary, but it is not presented in the classic Form D style going from left to right. It is in January that I receive 1099b as a document which is sheets of ¨paper¨ (screens), in a document on my computer. Can a TurboTax use that ? I would not think so. Apex is closed Monday Veterans Day making me wait until Tues to call and ask about this. Apex on line presents to me a menu of choices for me, but nothing stating "Use this for software input." Some of you may wonder why don´t I just call my brokerage. My brokerage has been absorbed by another brokerage firm that allows me to continue to use the good trading platform proprietary to my traditional brokerage and is fire-walled from the new firm´s resources. (Proprietary is not the issue; no one has allowed my trades to be posted on the acquiring firm´s assets for the purpose of downloading to my computer.


Question B: (Curious) I notice that the 1099b has a separate section for non-covered trades and are addressed there with presumably information from an earlier year the cost basis. And again related to box B on the Form 8949 is the notion of covered status. Since the opening leg of the trade is never presented to IRS, how does IRS handle verification of the trade result should on a case by case have a desire to drill down?

Question C: Why does my APEX clearing house repeat on its 1099b the trades all over again listed alphabetically by company name from which the stocks traded came from ? Would this be more for the ease of detecting wash sales ? If so, any other reasons ?

Question D: There is a section on 1099b for Expenses and Dividends. I see what strikes me is what I incurred when being in a short position the dividends I paid to share holder. Am I correct if I did not take on the election of trader status, this is not these amounts are not deductible ? Can there ever be something listed here useful for one who has not elected to be of trader status with the IRS ?
___________________________________________________________________________

I thank you warmly the posts up through Friday, Nov 8. I got mixed replies that were expected:
A. Essentially those that have done what I have done in the past making a one-liner on Sch D using the totals printed on the 1099 and using for dates a single date 1-1-20xx thru 12-31-20xx.
Or
B. Printing out from the brokerage into software that receives that input and applying to the Fed's forms Sch D and/or use of Form 8949.

If any has a post that does not fit either of those descriptions, please give me a shout out. Or if you wish, make any clarification of existing post, and I will happily receive it. Anyone who comes subsequent to this now post is welcome. Speaking of thanks, you are all princes (princesses some ?) and I am sincerely grateful to you. Honestly, the exchange at this thread is very important to me.

Comagnum, you had links that would sober one up—all commercial sales—implicitly hinting all the t's will be crossed and i's be dotted marching strictly to the notion of being full of info that the IRS cannot complain about in one's population of individual trades. Oh, and also...their statement that you cannot trust that dang “1099 B” for a few reasons, and they are there to cover the holes, like wash sales. I think that has been addressed adequately on this thread, including the fact that posters have identified they ARE accounted for in their respective worlds. I know my APEX does.

Again, my appreciation to posters: you seem to have eliminated any notion I had that there may have been some settlement compromise between the IRS and the real world. A resolution that would have facilitated a modicum of ease in the multi-trade, traders' style of information requirement to the IRS. Like not having to have a dump truck load of information.

Thank you all ! (I'm still monitoring for posts !)
 
Well I have some questions, too, as it is quite odd and non-nonsensical on my 1099-B.

1. My 1099-B states one section of my trades to be noted on Form 8949 on the Long Term trade page. The round trip trades listed are only three to 6 months old ! Why be directed to be stating them on the 8949 as long term trades ??

2. Another section on my 1099-B related to long term trades (and are actually short term trades) states they are uncovered trades. Investopedia refers to covered trades as those originated after Jan 1, 2011. These trades were certainly originated well after that and sensibly should be labeled covered trades.

Any ideas ?

Reference: Investopedia

https://www.investopedia.com/terms/n/non-covered-security.asp

the following is at the cited link:
What is a Covered Security?
In 2008, Congress passed legislation which required brokers to report the adjusted cost basis for securities and mutual funds to both the investors and the Internal Revenue Service (IRS), effective tax year 2011. Since 2011, the cost basis of certain securities has been reported through Form 1099-B which indicates whether the capital loss or gain from the sale of the security is short or long term. Any transaction that occurs on or after this effective year is a covered security and is reported on Form 1099-B.

Any stock in a corporation, including American Depositary Receipts (ADRs), acquired on or after January 1, 2011
 
Well I have some questions, too....

Question: My 1099-B states one section of my trades to be noted on Form 8949 on the Long Term trade page. The round trip trades listed are only three to 6 months old ! Why be directed to the 8949 as long term trades ??

Question: Another section on my 1099-B related to long term trades (and are actually short term trades) state they are uncovered trades. Investopedia refers to covered trades as those originated after Jan 1, 2011. These trades were certainly originated well after that ! ….and should be labeled covered trades as I see it.

Any ideas ?


Reference: Investopedia

https://www.investopedia.com/terms/n/non-covered-security.asp

What is a Covered Security?
In 2008, Congress passed legislation which required brokers to report the adjusted cost basis for securities and mutual funds to both the investors and the Internal Revenue Service (IRS), effective tax year 2011. Since 2011, the cost basis of certain securities has been reported through Form 1099-B which indicates whether the capital loss or gain from the sale of the security is short or long term. Any transaction that occurs on or after this effective year is a covered security and is reported on Form 1099-B.
Covered:
Any stock in a corporation, including American Depositary Receipts (ADRs), acquired on or after January 1, 2011
 
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