I think I have "entered" into a very large issue on a tax return that I am working on - not completed and not filed yet, thank goodness!
It has been discovered that stock transactions reported on the year end statements from the brokerage house, in this case Royal Alliance/Pershing, as supplied to the taxpayer are incorrect, as on the supplemental statement for "realized gain/loss" provided do not account for any "wash sale transactions". The statements only provide what we would usually need to complete the Schedule D - Dates acquired/sold, shares, cost/sales price, net gain/loss.
You might ask why, this supposition - Knowledge would tell me based on client information, that the client was scared off the market in late November 2008 and the year end statements show the client sold the base of his portfolio 11/21/08 - then the year end statement shows that he entered back into the market during 12/1/08 to 12/4/08, Those transactions are indicating that the broker purchased much of the same stock as sold on 11/21/08. Thereby entering into the Wash Sale Rules
Question 1, would this be normal procedure for the statement NOT to reflect Wash Sale - I receive many varying brokerage statements from brokerage houses that DO contain this information - this client's statement does not reflect even a "hint" of Wash Sale.
Question 2, whose responsibility is it to track this information and report this information, i.e. broker, taxpayer or tax preparer?
Question 3 - Who would be the responsible party to the IRS, if the wrong informantion was reported on the Schedule D?
Question 4 - Should I as a tax preparer offer the services to track this information for reporting to report on the Schedule D? I probably don't have all of the information available, so that even seems like a huge task!
Don't brokerage house and investment brokers have a responsibility and obligation to the client to provide the taxpayer with this information?
The questions arise, as I am not talking as in a few "minor" wash sales- The account activity is very large due to what is referred to a managed advisory account or whatever the terminology is for those accounts that charge a % fee. As posted off of the realized gain/loss supplement on 3 accounts I have over 900+ transactions.
Thanks for your thoughts and comments
Sandy
It has been discovered that stock transactions reported on the year end statements from the brokerage house, in this case Royal Alliance/Pershing, as supplied to the taxpayer are incorrect, as on the supplemental statement for "realized gain/loss" provided do not account for any "wash sale transactions". The statements only provide what we would usually need to complete the Schedule D - Dates acquired/sold, shares, cost/sales price, net gain/loss.
You might ask why, this supposition - Knowledge would tell me based on client information, that the client was scared off the market in late November 2008 and the year end statements show the client sold the base of his portfolio 11/21/08 - then the year end statement shows that he entered back into the market during 12/1/08 to 12/4/08, Those transactions are indicating that the broker purchased much of the same stock as sold on 11/21/08. Thereby entering into the Wash Sale Rules
Question 1, would this be normal procedure for the statement NOT to reflect Wash Sale - I receive many varying brokerage statements from brokerage houses that DO contain this information - this client's statement does not reflect even a "hint" of Wash Sale.
Question 2, whose responsibility is it to track this information and report this information, i.e. broker, taxpayer or tax preparer?
Question 3 - Who would be the responsible party to the IRS, if the wrong informantion was reported on the Schedule D?
Question 4 - Should I as a tax preparer offer the services to track this information for reporting to report on the Schedule D? I probably don't have all of the information available, so that even seems like a huge task!
Don't brokerage house and investment brokers have a responsibility and obligation to the client to provide the taxpayer with this information?
The questions arise, as I am not talking as in a few "minor" wash sales- The account activity is very large due to what is referred to a managed advisory account or whatever the terminology is for those accounts that charge a % fee. As posted off of the realized gain/loss supplement on 3 accounts I have over 900+ transactions.
Thanks for your thoughts and comments
Sandy
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