1099B Gain/Loss

[geekgirldany]

Customer got a 1099B. Called the investment company and got a print out of the transactions. There were three funds and the 1099B showed the total for all three. Now on the break down sheet it divides the three funds out with cost and amount received. The other two columns show "realized gain" and "gain". The realized gain, cost basis, and sales amount is totaled at the end of each fund. Gain column is not. There is then a summary page showing the total cost basis, sales amount, and realized gain/loss.

Here is what I can't understand. Cost basis column is alot less than Sales amount column. Cost is 9000, Sales is 11,000. So should be a gain, right? Yet the summary is showing a realized loss of -2000. On all the breakdowns for the funds the realized gain/loss column is showing a loss. It is not coming out to Sales - Cost=Gain/Loss. It is off.

Does this have to do with reinvestments? Is realized gain really something else entirely.?

[Unregistered]

wash sale?

Maybe a wash sale? I have a client that sells some mutual funds every month and a portion is disallowed due to him purchasing more of the fund.

[Bill Tubbs]

Reinvestments

Here is what I can't understand. Cost basis column is alot less than Sales amount column. Cost is 9000, Sales is 11,000. So should be a gain, right? Yet the summary is showing a realized loss of -2000. On all the breakdowns for the funds the realized gain/loss column is showing a loss. It is not coming out to Sales - Cost=Gain/Loss. It is off.

Does this have to do with reinvestments? Is realized gain really something else entirely.?

I would bet reinvestments. It is quite possible to have originally invested $9000, had taxable dividends over the years of $4000 (raising cost basis to $13,000) -- then selling at $11,000 would be a $2000 profit (11,000 - 9,000) but also a $2,000 taxable loss ((11,000 - 13,000).

Have you done prior year returns where you've seen taxable dividends? Most (but not all!) dividends get reinvested.

If this is all the information you have, I would go with the highest basis they show, because of the likelihood of dividends reinvested.


Good luck,
Bill

[geekgirldany]

This will make the third year I have done their taxes. It looks like it was invested in 2000. I also think it is probably reinvested dividends. I'll go with your suggestion Bill. Thank you both for the help.

[Brian EA]

This will make the third year I have done their taxes. It looks like it was invested in 2000. I also think it is probably reinvested dividends. I'll go with your suggestion Bill. Thank you both for the help.

If it was reinvested dividend the 1099B would have indicated that. It's kind a weird .

Any way the way I would report it is Sales- Loss = Cost.

[Bill Tubbs]

You're welcome

This will make the third year I have done their taxes. It looks like it was invested in 2000. I also think it is probably reinvested dividends. I'll go with your suggestion Bill. Thank you both for the help.

You're quite welcome geekgirldany -- though I do wonder how you came up with your handle.

Bill

[Chief]

Handle

Bill:

Have you not heard of the Geeks at Best Buy. You've been talking to a tax geek.

[geekgirldany]

well I am a mix of computer/internet geek and tax geek. Long story short... during the off tax season I repair computers and do website design. Great side income to my year around bookkeeping/payroll. A hobby that turned into a money making service.

Also in the beginning of the internet forums I was most of the time the only woman on the board. So a few guys started calling me geek girl.

[Bill Tubbs]

Geek guy...

well I am a mix of computer/internet geek and tax geek. Long story short... during the off tax season I repair computers and do website design. Great side income to my year around bookkeeping/payroll. A hobby that turned into a money making service.

Also in the beginning of the internet forums I was most of the time the only woman on the board. So a few guys started calling me geek girl.

By that definition, maybe I should go with "geekguy" -- I'm the neighborhood computer geek -- or at least was until I took up tax prep. (still wondering about the "dany" part -- would that be your real name?) I'm a year-round programmer for who tax prep started as a hobby, and has turned into a decent money-maker. I also hope that I'm helping people out -- helping them save taxes, or at least saving the fees vs. going to the "big guys" (translation: I need to raise rates!).

Website design is far from my forte! I've done a few, but primarily focus on the database interactions.

Well, gotta get ready for next appt.

Bill

[Snaggletooth]

Vote for Tubbs

Geeky, I'm going to vote the same way Bill Tubbs would report. If there was an original investment in 2000, then almost all funds since then have suffered a cumulative loss.

I also take exception with the notion that the 1099B shows reinvested dividends. There is no requirement that this be done. As a matter of fact, Geeko was lucky the custodian was able to provide as much information as was the case (albeit confusing). Lots of 1099Bs show absolutely nothing except sales value, and the custodian provides nothing else.

Bill, here in the South is an old proverb attributed to the Bible, "Every Tubb shall sit on its own bottom." I've never seen a preacher who could show me this in the Bible, but I know people who swear it is in there. At any rate, I've noticed your entry into the TTB family on the board in recent weeks, and have enjoyed reading your posts.

[geekgirldany]

Dany is for Danyelle.

Snag it took a while to get that information. Client didn't even know about the sale until I went through the investment papers and found the 1099B. Then it took him calling for 3 weeks to get this print out. I'm am glad I got it. Like you said a little confusing but it made a little more sense on it being reinvested dividends.

I've also enjoyed Tubbs contributions.

Thank you all.

[Bill Tubbs]

Voting

At any rate, I've noticed your entry into the TTB family on the board in recent weeks, and have enjoyed reading your posts.

Yes, I have enjoyed this forum since I stumbled upon it earlier this season. Seems to be a happy medium between the 2 ATX boards -- posts can get los on the one so quickly, and the 2nd one doesn't get much traffic. Though I would actually prefer a different interface on this board, it works.

So, is this where I'm supposed to say "I've enjoyed reading your posts too" ?

Bill

[Bill Tubbs]

All right you two, cut it out!

I've also enjoyed Tubbs contributions.

... you're making me blush!

Dany is for Danyelle.

Hey Dany, nice to (virtually) meet you! Figured it was either part of your name or that the NY was a reference to New York. Now that's taken care, I can sleep easy tonight!

G'night all,
Bill