Brokerage statement

[DTS]

I'm looking at a statement showing stocks sold that were held s/t. The client has own this stock since late '01 and it's been with this brokerage for years. It's a little late for a corrected form.

Not sure if I should report correctly, which would be opposite the 1099-B.

Any input is appreciated.

[Burke]

If the brokerage statement shows short-term, then that is supplementary information provided only to the account-holder, not the IRS. The only thing IRS gets is the gross proceeds. Report correct holding period on Schedule D.

[Kram BergGold]

I suggest

Unless the stocks were transfered to this account from another account I would call
the broker and confirm what yor client says is true. I have never seen what you are talking about except when stocks are transfered into the account or inherited.

[DTS]

Thanks to both of you.

Stocks were inherited in '01. Since the account has been open for years, I'm not sure why the broker would not show a l/t holding period, but I will report the correct holding period.

Thanks, again.

[Lion]

Just did it...

Client brought three notebooks of info and spreadsheets (yesterday!) and has been faxing and emailing me more. She disagrees with a couple of the dates on her gain/loss reports and included purchase confirmations and year-end statements listing the purchases. I entered her dates, as she's the only one who'll compare them with the gain/loss statements. Just made sure the gross proceeds matched the 1099-Bs.

I'm partway through her first notebook, by the way! And, one more client to drop off Thursday! My back hurts, a muscle is in spasm, and I really want to take my muscle relaxant meds but will wait until after midnight Friday.

[FEDUKE404]

Gotta be a reason to categorize as short term

This sounds like a mess - why in the heck was this not resolved earlier in the year??

In any case, there must somewhere be a good reason the stockbroker is calling something short term, especially since you stated the account with the stocks has been active for several years. While the stockbroker (depending on his skills) may not have the correct (inherited) cost basis, he certainly should have the correct holding periods.

I would be very leery of interim stock sales/purchases of the stock(s) involved. Also, if the stock was reorganized or similar, that could be a confusing issue with new shares, cash in lieu, stock+cash reorganizations, and more. An example of such nonsense would be what some of the bank stocks recently went through. The only hope there is to visit the corporate web site (IR) and look for useful worksheets.

I doubt if you can resolve this by Oct 15th - for now I would use a SWAG approach and attempt repairs later. The billable hours would definitely be running!!

FE

[Lion]

Brokers

Well, her broker left ML for WF and some of her accounts got transfered to a NJ office of ML, maybe to make it harder for the leaving broker to take all his clients. So, she has ML statements and WF for 2009. She also has chronological notebooks full of her documentation dating back to the purchases. And, most of her trades were losses in 2009 with a huge capital loss carryover, so term really isn't important. There were very few trades until her 2009 divorce, so I did skim through her notebooks to make sure those particular stock purchases were still there on each year-end statement and didn't show up on 1099-Bs. I'm fine using the dates she documented. In at least one case, I think it was just a typo when the account moved as the month and day are the same with the year actually 2003 instead of 2008. And, I'm charging her an arm and a leg for her returns.

[taxxcpa]

Holding period

If the client has any kind of proof; e.g. old brokerage statements, then I would just use a long-term holding period on the tax return. Then if the IRS questioned it, show them the proof. It is highly likely that the IRS will not question it, but if they did, deal with it then.

[DTS]

...for now I would use a SWAG approach and attempt repairs later. The billable hours would definitely be running!!

I had to look up your "approach" and this is the best way to go.

[Lion]

Another

Someone on one of these boards posted a method named something like "derivatively computed" which I loved and used and now have forgotten the exact words! It was basically a euphemism for fudge factor or the number we have to use to make it work, get to the answer we expect.

[taxxcpa]

Euphemism

Someone on one of these boards posted a method named something like "derivatively computed" which I loved and used and now have forgotten the exact words! It was basically a euphemism for fudge factor or the number we have to use to make it work, get to the answer we expect.

I don't think "SWAG" is quite as euphemistic. It was one of the terms we used when I was a Compliance Analyst for ARCO. One girl in our office had no idea what it meant and labeledan arbitrary adjustment factor in her workoaopers as SWAG.

[JohnH]

We used the term SWAG way back when I was in the Air Force maintaining radar systems on the F4 Phatom jets in the late 1960's. The pilots usually didn't seem to appreciate the humor in our parlance.

[FEDUKE404]

And then...

We used the term SWAG way back when I was in the Air Force maintaining radar systems on the F4 Phantom jets in the late 1960's. The pilots usually didn't seem to appreciate the humor in our parlance.

You should have just told them that a SWAG initiative on your part is an improvement on the potential FUBAR scenario they might otherwise encounter without your expertise.

We also frequently used the phrase "close enough for government work"......

FE

[DonPriebe]

You should have just told them that a SWAG initiative on your part is an improvement on the potential FUBAR scenario they might otherwise encounter without your expertise.

We also frequently used the phrase "close enough for government work"......

All of which could be avoided if the vendor had applied MIL-TFP-41.

(Make It Like The f-in Print For Once!)

[taxxcpa]

Swag

We used the term SWAG way back when I was in the Air Force maintaining radar systems on the F4 Phatom jets in the late 1960's. The pilots usually didn't seem to appreciate the humor in our parlance.

I had never heard of it when I was in the Air Force. I was in the Auditor General's department and some of the people we audited must have applied a little SWAG in maintaining their records.