I have a client who received a1099-B from Hilliard Lyons. There are several lines listing a description of: GNMA Missing Cost Basis - It shows proceeds - but instead of showing it as a "SALE", it shows "PRINCIPAL".....Does anyone else have any experience with this? Appears to be Government National Mortgage Association (Ginnie Mae). Would this be just a return of principal without any tax consequences? Any help is appreciated!
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GNMa Etc 1099B
My experience has been that the Ret of Princ is reflected in the Gross Proceeds on the 1099B - so I enter on the Sched D and show ret of princ cost basis the same as the amount of proceed.
I have seen the client IRS transcripts so it is reported into the IRS computer, and needs to be found on the matching program to the tax return.
Sandy -
GNMA Activity Lists "Principle"
Mine too says principle. Unless I get a corrected 1099XXXX. Mine shows NO interest earned ion the interest 1099-INT. ? What gives?Comment
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On the return of principal, the client (or you) has to keep track of what is returned. Any amount received over the amount of the principal is capital gain income. Or, if the total amount is less when the fund is completely closed out, you have a capital loss.Originally posted by S T View Post
Most clients have no clue. I try to get the initial purchase amount and keep track of this for my clients.Jiggers, EAComment
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If it is Edward Jones they will try to figure out the basis for you. Sometimes it is a loss for the client.JGComment
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Thanks to everyone who responded!
Thanks so much for your input. I too am curious why it shows the return of principal on the 1099-B but no interest on the 1099-INT. The client just happened to include their Hilliard Lyons account statement for the time period December 1 - December 31, 2011 and it showed under income and distributions, taxable interest of $93.58 for the current period (December) and year-to-date interest of $486.51, yet the 1099-Consolidated Tax Statement shown as "CORRECTION: 3/12/12" shows the Form 1099-INT with all zeros.
I think I will give the Hilliard Lyons office a call in the morning just to clarify.
Again, thanks to everyone for your wonderful and timely responses!
Happy tax season.
MoComment
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Look for a 1099-OID statement - they are usually separate and issued late.
Yes, Jiggers you are correct, but I am fortunate with my clients and the brokers supply with with the information, and hopefully the brokers will be supplying more of that information in the future with the new cost basis reporting.
SandyComment
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Contacted Brokerage Firm This Morning....
and they were kind enough to fax over a copy of the 1099-INT (which my client received in the mail this afternoon!).....finally able to get that return finished....yippee!!!
Thanks again for your help!
MoComment
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