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schedule D software
- Thread starter phfmgr
- Start date
yep, I got audited once, three years schedule D, it's such a painful process.
Quote from JackR:
That's the way it used to be.
Last year the IRS stated they wanted all detail. There was much discussion and you might do a search on ET.
Another acceptable approach, but you will not be able to file electronically, is to prepare an Excel spreadsheet with the columns laid out in the Schedule D format. Carry the Excel total to the appropriate line on Schedule D and make reference to the Excel attachment on the Schedule D.
Here are two extracts from the 2006 Schedule D Instructions:
Do not enter "available on request" and summary totals in lieu of reporting the details of each transaction...."
.....
Like an investor, a trader must report each sale of securities (taking into account commissions and any other costs of acquiring or disposing of the securities) on Schedule D or D-1 or on an attached statement containing all the same information in a similar format.
Jack
Tradelog works well, I've used it for a few years. Just google it. It calculates all your trades and wash sales, matches them together, then gives you a printable format to send to the irs. Then you just add in your total cap gains or loss in your tax document, ie tax software. Since the irs requires you to show all the trades for stocks, you need something like this. Tradelog is pricey, but after you use it once, the next year, you get a discount on upgrades if say you want to switch to mark to market reporting, you can upgrade to the software that will calculate that for you. Good luck.
I have used Tradekeeper from Americanware for the past several years. It is a multistep process to save and import the transactions but it does do the job if yours is one of the supported brokers.
http://americanware.homeip.net/tk/index.htm
http://americanware.homeip.net/tk/index.htm
Quote from phfmgr:
is this the total number or just one brokerage firm ? I have three accounts to combine, the total number is close to 100k.
thanks.
Total number of entries. It is based on the number of D-1 forms it can generate and track. Looks like the spreadsheet method is the way to go for you. If you use the spreadsheet method pay attention to wash sales.
Jack
Quote from JackR:
Total number of entries. It is based on the number of D-1 forms it can generate and track. Looks like the spreadsheet method is the way to go for you. If you use the spreadsheet method pay attention to wash sales.
Jack
thank you Jack. you can declare yourself as a "market to market " trader, then you don't have to worry about wash sales.
I agree about the wash sale rule for traders but ...
If you qualify as a "Trader in Securities" you can use "mark-to-market" accounting. There are some rules to this:
a) You meet rather vague IRS criteria to be a trader. You can file as a trader when you file your tax return, no earlier declaration is required. But you have to prove you meet the criteria if challenged.
b) To use 'mark-to-market" accounting you, per the IRS -
In general, the mark-to-market election must be made by the due date (not including extensions) of the tax return for the year prior to the year for which the election becomes effective. The election is made by attaching a statement either to your income tax return or to a request for an extension of time to file your return. The statement should include the following information:
1. That you are making an election under section 475(f) of the Internal Revenue Code;
2. The first tax year for which the election is effective; and
3. The trade or business for which you are making the election.
Thus, if you did not sign up for mark-to-market accounting when you filed your 2005 1040, it is too late for your 2006 return.
Jack
If you qualify as a "Trader in Securities" you can use "mark-to-market" accounting. There are some rules to this:
a) You meet rather vague IRS criteria to be a trader. You can file as a trader when you file your tax return, no earlier declaration is required. But you have to prove you meet the criteria if challenged.
b) To use 'mark-to-market" accounting you, per the IRS -
In general, the mark-to-market election must be made by the due date (not including extensions) of the tax return for the year prior to the year for which the election becomes effective. The election is made by attaching a statement either to your income tax return or to a request for an extension of time to file your return. The statement should include the following information:
1. That you are making an election under section 475(f) of the Internal Revenue Code;
2. The first tax year for which the election is effective; and
3. The trade or business for which you are making the election.
Thus, if you did not sign up for mark-to-market accounting when you filed your 2005 1040, it is too late for your 2006 return.
Jack