200 Stock Sales is too much!

[dyne]

A client of mine for many years came in today with their usual W-2 forms from FIVE states. But this time they had 1099-B forms reporting about 200 stock sales. That is TOO much! I decided long ago that there is a point beyond which I refer a client to a local CPA. And each stock was listed in a column in which the purchase date was listed and in the SAME column UNDERNEATH the date of purchase was the date of sale. That makes it VERY tedious to enter the data. I refered them to a local CPA. In addition they are leaving on a two week
trip in a few days? Why do clients do that?

[Mo Sheets]

That is why I charge for my time...

Unlike most of the local tax preparation places, I charge my clients according to the length of time it takes me to enter their return. I feel this is the only fair way to do it. If someone has only one line item on a form, I can't justify charging THEM $20 to fill out the form. Likewise, for something you described, it's not fair to ME to only receive $20 to complete a form that may take me several hours.

If it were a good client, I would do it no matter how many lines. If it is a client that you are not 100% thrilled to have as a client, I can understand your wanting to send them elsewhere.

Mo

[BHoffman]

Hi dyne - I wonder if there any way to mail the brokerage statement with form 8953 and just enter the totals on that new form 8949? I've done that before with Sch D and had no problems.

[AZ-Tax]

What I would have done if I understood you thread correctly

Depending on the firm usually the 1099-B and/or the full year brokerage statement would have detailed and caculated out the ST gains and losses and LT gains and losses. If so then I would have entered only the summary in Sch D meaning one line for all ST gains and losses and one line for LT gains and losses. Then I would have made copy of the detailed 1099-B or detailed brokerage statment and mailed it in along with a completed form 8453. Been doing it for years for a client that trades options and stocks. Now if the 1099-B or Brokerage statement is not detailed, confusing etc., have your client go to his Brokerage firm and obtain a more clearer detailed report OR have you client generate a report thru "gainskeeper". If by any chance these 200 trades was "cashless" options for which the gain was reported as taxable income on his W-2's, it gets a little more tricky but you do NOT need to enter all 200 exercised option trades. Hopefully this addresses your thread correctly.

[erchess]

My Two Cents

I have not seen a number of stock transactions I won't take but when I billed by the form instead of the hour the first five were a dollar and after that each one was 75 cents each. Now my time is simply $150 an hour and I don't see what the problem is with the stock transactions. I would do it on a pick up and deliver rather than a do it while you wait basis and I would give two warnings - I often hit snags that stop work on a return until I can speak with a client during business hours and even if that doesn't happen to your return you could wind up going on extension because your job won't be the reason I work over 45 hours in a week or turn down or delay an easier simpler job.

I wish there was a way you could have referred this guy to me.

[AZ-Tax]

What is form 8953?

Hi dyne - I wonder if there any way to mail the brokerage statement with form 8953 and just enter the totals on that new form 8949? I've done that before with Sch D and had no problems.

What is form 8953 used for and form 8949 looks like a continuation of Sch D.

[Y2KEA]

What is form 8953 used for and form 8949 looks like a continuation of Sch D.

I think BHoffman means form 8453 but this form is generic with no numbers, only check boxes. And yes form 8949 is the new detail sheet which carries to sch D.

[dyne]

Yes, I realize that I COULD paper file the returns but since the client also has W-2 forms from FIVE states it would be TOO MUCH to spend that much time, paper and postage to paper file. I usually refer one or two clients every year to a CPA and this is the first one this year.

[DonPriebe]

Yes, I realize that I COULD paper file the returns but since the client also has W-2 forms from FIVE states it would be TOO MUCH to spend that much time, paper and postage to paper file. I usually refer one or two clients every year to a CPA and this is the first one this year.

There is no problem with e-filing a return and then sending the "attached" brokerage statements by mail. That's what the 8453 is [currently] designed to do.

[BOB W]

The problem with brokage statements is that the brokers are misinturpeting the IRS instructions. IRS says they are not REQUIRED to report cost basis for purchases prior to 2011. Thus we get 1099B's without cost basis for most LTCC. This makes the statement usless and I now have to enter each trans action and code them according to 4 different codes.

IRS did not mean DON"T reports older purchase cost basis, just you are not required to report old cost basis.

[FEDUKE404]

Sch 8979 entries in general

The problem with brokage statements is that the brokers are misinturpeting the IRS instructions. IRS says they are not REQUIRED to report cost basis for purchases prior to 2011. Thus we get 1099B's without cost basis for most LTCC. This makes the statement usless and I now have to enter each trans action and code them according to 4 different codes.

IRS did not mean DON"T reports older purchase cost basis, just you are not required to report old cost basis.

Actually I've found that most of the brokerage firms are preparing "their" (client) reports the same way as before, showing purchase/sale dates/costs gain/loss. What shows up on the IRS Form 1099-B is less informative. On the actual Form 1099-B, you also have to be careful as to what cost basis was/was not reported to the IRS. (In most, but not all, cases a reported cost basis will show for assets acquired starting 01/01/2011.)

The thing that makes my work more difficult is that on the Form(s) 8979 there is no calculated gain/loss shown. Since it can be difficult to check the net gain/loss, it takes more time to verify the accuracy of what I entered.

And then, on Schedule D, you may have 50 reported LTCG and see....only one!....amount in column (h).

It just makes our life a bit more tedious....and the billable hours a bit higher.

FE

[BOB W]

So what are you doing, sending in "Client reports" instead of 1099B and how are you classify with or without cost basis based on 1099B????????

[Burke]

1. Group the sales based on:

a). basis reported to IRS, Code A.
b.) basis shown but not reported to IRS, Code B.
c.) no basis listed, Code B.
d.) no 1099-B rec'd, Code C.

Then enter one entry on the input/detail sheet for stock sales in your software for 8949 for long term, and one for short term, for each of the above. At most, 8 entries. Software will allocate correctly to the proper number of 8949's, and summarize them on Sche D. Then attach brokerage statements to Form 8453 and mail within 3 days of e-file transmission. Then it becomes manageable. PS: In the case of 1099-B's from brokerages, item D would not even factor in, which means 6 entries at most.

[JG EA]

I have someone else enter everything - then it seems like no time at all.

Seriously, I think it is best to enter it all. Especially if you have to enter the basis. It helps to make sure you understand what is happening, whether there are wash sales, on so on.

Charge by the time sure. But I just put a price on each line. So, I have a Sch D charge on its own, even if only 1 sale, and then a line charge for each entry on the 8949. That helps the time go faster if I'm doing it and covers wages if someone else is doing it.

[Possi]

Me, too...

I have someone else enter everything - then it seems like no time at all.

Seriously, I think it is best to enter it all. Especially if you have to enter the basis. It helps to make sure you understand what is happening, whether there are wash sales, on so on.

Charge by the time sure. But I just put a price on each line. So, I have a Sch D charge on its own, even if only 1 sale, and then a line charge for each entry on the 8949. That helps the time go faster if I'm doing it and covers wages if someone else is doing it.

But when the 1099B detail was 78 pages, I did the summary and sent that bad boy with the 8453.

I'm doing the same thing on my own personal return this year, too.

Yes, a price for the Sch D and a price per line entry. It comes out fair to all. The one will mail in will get a handling charge instead of a line by line entry charge. For 78 pages of trades, she couldn't afford me, and I couldn't afford the time it would take. We are all happy and I feel like I am doing a good job for my client.