Getting an error "Date acquired is after date sold". I sold put option on 05/14/2020 and closed on 05/28/2020. why turbo tax report this an error?

[shergar]

There is an additional potentially more serous issue I came across here. If in going through these transactions one by one, you change the security type to Options (which seems like a logical move), then you will be asked to select "Sold" or "Expired". DO NOT SELECT EXPIRED for short options positions, since TurboTax then (invisibly) sets the Gain/Loss for the transaction to zero, potentially leading you to under report.

[HeatherPLO]

We would like to take a closer look at this experience. Please reach out to us directly using the Help Article here.  This ensures you will get to the correct department as quickly as possible. 

@shergar

[aataxes]

I never tried using expired as the date so I personally haven't observed TT actually changing any of the box A info only that it doesn't like the way E-Trade or Robinhood report the transactions on the 1099b.  

However upon closer study, TT is actually correct.  For short trades only the closing date should be reported on the 1099b and hence the 8949.  The dates should be the same or one day apart if the option expired worthless.  

Nonetheless, TT needs to help us through this quagmire not make it more difficult.  I ended up using TT desktop deluxe becausei t doesn't care that the sold date is wrong and neither does the IRS.  I have been filling out my 8949 identically to the way my 1099b reports the transactions for years without any comment or concern from the IRS even though it reports them technically wrong.

What is new is that TT online edition actually cares and throws up a road block preventing me and many others from using it efficiently.

[JillS56]

When you sold to open the position, that was the date you acquired the position.  And the date the option expired, or you bought to close the position is the date you disposed of the short position.  So, enter the date you acquired the position as the "purchase" date and the date you disposed of the position as the date you "sold" the position.  The premium you received for selling the option is your proceeds.  If you bought to close the position, that would be your cost.  If it expired worthless, the cost basis is zero.

[sky5]

Hi JillS56, 

what your saying is seems against below IRS PUB 550..  based on IRS pub 550. acuire date is closing date/expire date for writting an option, not the date of opening the position .

Please refer to IRS PUB 550 for how to report on 8949

Quote from PUB 550:

"If an option that was granted (written) expired, enter the expiration date in column (b) 'Date acquired ' and enter “Expired” in column (e) 'Cost or other basis.'. Fill in the other columns as appropriate."

based on above IRS note, for selling a option and it expired, acquired date is expiration date not the date you sold to open the position. 

[aataxes]

Please understand that this issue is not on how to fill out the form, but rather about getting TT to do it automatically since lots of us have hundreds of these to "fix."  Some brokerages report the information in a way TT likes and others don't... E-Trade and Robinhood specifically do it wrong.  What we are asking is for TT to ingest the 1099s from these brokerages and fill out the 8949 satisfactorily knowing full well how said brokerages report these transactions...right or wrong.  Also understand that E-Trade has been reporting it this way for years and up until last year TT had no issues dealing with it.  In fact, TT Deluxe desktop edition that you install on your computer handles these transactions by just reporting non adjusted box A entries and for those it matches the dates that E-Trade used.  IRS has never rejected my returns filed this way.

[shergar]

Yeah, I tried but couldnt get through to anyone who was able to link me to this thread.

You guys do need to fix this reporting issue. I had ~150 short options trades this year, and it took me 90 minutes to step through each one and make TT happy with the date info. That was the second time, because the first time I was anhour into it when realised that selecting "expired" on some positions was zeroing out those transactions, and I had to delete and re-import the 1099-B. I dont really care about the rights and wrongs of how the dates are entered, there needs to be a practical way to select large numbers of trades and fix them, or - preferably - 1099-B import needs to be fixed. Also your trade entry form needs to be updated to handle the following two cases:

1. Short options positions which expire - the "sell" proceeds should NOT be zeroed out.

2. Short options positions that span a tax year - Sell dates earlier than the first day of the tax year need to be accepted.

Strong recommendation: "Buy" and "Sell" have unambiguous meanings. Nobody refers to a "Sell to Open" transaction as a "purchase". Better to use "Open" and "Close", which are also unambiguous and will be immediately understood by anyone who trades options.

[rtang]

This is super frustrating. Have to manually reverse dates for hundreds of option trades. TT: Etrade is correct,  period. I have been using TT for many years, but will be looking for other tools. 

[HPatel8]

I agree TT is INCORRECT in pointing this out as an error. If I have to change ALL the dates on my short puts and short calls, It amounts to 345 edits which would take me about at leat that many minutes. 6 Hours.  This is stupid and TT should respond to this and fix the error.

I called my brokerages too.  Sale to Open call/put is Date Sold and Buy to open call/put is Date Bought. Bottom line is selling can occur before the buying and it should not be flagged by TT.

I hope turbotax respond to this and fix this. Reversing the dates is not the solution.

[HPatel8]

Bad Advise.

[tkoko]

Turbo Tax - This is frustrating - I do not care what the reasoning is - The imported dates should be handled by TT appropriately - If Etrade is reporting wrong then TT knows that i am importing from Etrade - so fix during import and give a button for user to ack - There is no way users are going to edit hundreds of transactions - It defeats the point of importing.  

I have been using TT for over 10 years - If this is not fixed immediately - i am moving out - No way I am editing hundreds of entries while also paying for the software. 

[Jveasy3]

Uh Oh.... I shouldn't have waited till the last day to file my taxes. Now I have to manually updated a bunch of entries also... My carpel tunnel is going to act up.... TT please fix this so it's not an issue. If you know Etrade reports this way, at least add a button that will update all the dates for the same issue at once (i.e. set the dates equal to each other where error = bought after sold). Thanks!! 

[mordyvt]

Hi, I am also from the future and am having trouble with the same thing.  😦

[setgree]

Hi, apparently this still doesn't work? I'm looking at my 1099 from Wells Fargo, specifically

1099-B Proceeds from Broker and Barter Exchange Transactions Details, continued Short Term Gains/Losses - Report on Form 8949, Part I with Box A checked

And "Date Acquired (Box 1b)" is consistently after "Date Sold or Disposed (Box 1c)". 

I highly doubt Wells Fargo is making an error here. I want TurboTax to have an option for "ignore this error."

[fanfare]

@setgree 

Some brokers report short options according to IRS requirements, and some do not.

if they do not, is that an error on their part?