Solved: Irs sent me a bill saying I owe money for securities
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Irs sent me a bill saying I owe money for securities

 
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Level 15

Irs sent me a bill saying I owe money for securities

This is a common situation. You sold securities (stocks, bond or mutual funds) and failed to report it on your tax return. The IRS gets a copy of the form 1099-B that your broker issues for this transaction(s). The IRS assumes the gross amount, on the form 1099-B, is taxable until you show them that your capital gain (profit) or loss was something different. You need to prepare an amended return, including form 8949 and schedule D, to show the gain or loss. 

If your net bottom line will not change on your tax return, sometimes the IRS will accept a letter stating the facts and proof of your cost basis (usually a copy of the original purchase confirmation) instead of a full amended return.

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Level 15

Irs sent me a bill saying I owe money for securities

Did you sell securities and fail to claim the sale?  If so, the IRS only knows the gross sale price (from the 1099-B), but not what you paid, so they assume it was zero.
Level 15

Irs sent me a bill saying I owe money for securities

This is a common situation. You sold securities (stocks, bond or mutual funds) and failed to report it on your tax return. The IRS gets a copy of the form 1099-B that your broker issues for this transaction(s). The IRS assumes the gross amount, on the form 1099-B, is taxable until you show them that your capital gain (profit) or loss was something different. You need to prepare an amended return, including form 8949 and schedule D, to show the gain or loss. 

If your net bottom line will not change on your tax return, sometimes the IRS will accept a letter stating the facts and proof of your cost basis (usually a copy of the original purchase confirmation) instead of a full amended return.

View solution in original post

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