Has someone been able to resolve the error on negative proceed on 1099-B? Before saying it's a mistake, it is not a mistake, it's short selling premium option trading

[m-v1]

I have lots of option trades, which are a combination of spreads and shorting puts or calls. The trade always starts with negative proceed on all those, and that is how it gets reported on the form. How do we deal with this?

I am thinking of instead of automatic importing, I just input the total numbers and upload the form instead. Anyone  has had any success?

[ReneeM7122]

You're correct, the issue with regard to the negative proceed on 1099-B isn't due to a mistake.  It's a rounding issue.  If the adjustment is $0.49 or less, then it is automatically rounded to zero.  This type of rounding is allowed by the IRS.  Unfortunately, zero is not a valid value for this field -- thus the error message.

To resolve the issue, you can still import the transactions but you'll need do delete anything that is .49 or less.  This will clear the error message.  

To do this, you will need to revisit the input section for the Form 1099-B transactions.  Use the following steps:

• On the top row of the TurboTax online screen, click on Search (or for CD/downloaded TurboTax locate the search box in the upper right corner)
• This opens a box where you can type in “1099-B” and click the magnifying glass (or for CD/downloaded TurboTax, click Find)
• The search results will give you an option to “Jump to 1099-B”
• Click on the blue “Jump to 1099-B” link
• Click Edit beside the institution name
• Click Edit beside each transaction that contains a wash sale adjustment amount of $0.49 or less
• Delete the wash sale adjustment amount and click Done

 Here is more information about IRS guidelines and rounding: https://www.irs.gov/publications/p17/ch01.html  

Computations

The following information may be useful in making the return easier to complete.

Rounding off dollars.

You can round off cents to whole dollars on your return and schedules. If you do round to whole dollars, you must round all amounts. To round, drop amounts under 50 cents and increase amounts from 50 to 99 cents to the next dollar. For example, $1.39 becomes $1 and $2.50 becomes $3.

If you have to add two or more amounts to figure the amount to enter on a line, include cents when adding the amounts and round off only the total.

Here is a TurboTax article that explains Form 1099-B Proceeds from Broker transactions

How Form 1099-B is used

The 1099-B helps you deal with capital gains taxes. Usually, when you sell something for more than it cost you to acquire it, the profit is a capital gain, and it may be taxable. On the other hand, if you sell something for less than you paid for it, then you may have a capital loss, which you might be able to use to reduce your taxable capital gains or other income.

[m-v1]

Hello,

Thanks for your response. 

I don't have this problem. The error is not due to zero, it's because I have large numbers that are negative, i.e. -1400.

[D_ONEILL]

I’ve got the same issue as the other poster and for the same reason.

In our case, it has nothing to do with rounding.  The “Review” process states that the value must be zero or greater, which is not the case.

[dzzz]

I agree. I have the same problems caused by selling put options and then buying them back at a loss.  ToddL99 posted a work around that works but I am concerned about changing the information that  I submit compared to what the broker is submitting even though the net effect is the same.

[jjs_112358]

Is there any way to do bulk edits? I have 150+ transactions that all had a disallowed wash sale loss <$0.50. Each transaction takes ~20 seconds to complete once clicking through if any additional situations apply to the sale. I'm not looking forward to taking 50 minutes just to delete a value for each sale.

[fanfare]

search the forum and you will see there is a big brouhaha on these three issues

• rounding
• negative proceeds
• tiny disallowed losses.

[fanfare]

@m-v1 

If you have shorted an option you have collected premium.

that is a positive proceeds, not negative,

you can't collect or pay out negative dollars.

only column (h) can be less than zero.

--- ---

See what I mean ?

[m-v1]

Obviously, but that is how it gets reported on 1099-B it has always been like that. It's out of my control. This is common when you have spread, one leg is positive and one leg is negative. 

I am thinking of deleting the import and just manually enter the total numbers and upload the forms and transcript for IRS. 

[Steven101]

ReneeM7122 and other experts I've talked to at Turbotax either are not fessing up to the issue that Turbotax is purposefully blocking folks, common folk anyway, from using Turbotax when Fidelity especially but also etrade and any other brokerage reports a negative value on Form 1099-B for anything.  

Turbotax Online users are being told to take a hike again in 2021!!!!!!  Also, I was told it's not that they don't won't your money, it's that they can't fix it so that "Sales Price is not between the prescribed upper and lower limits" response stops common people from filing.  Someone from Turbotax even recommended that I try another service that has an H and an R in it, or just not use Fidelity or etrade or any other brokerage that refuses to provide 1099-B Worksheet data per IRS requirements.

[D_ONEILL]

@Steven101 

That’s just the thing...negative values for box 1d are clearly and plainly described in the 1099-B instructions as are some reasons the box might be negative.

This is a TurboTax problem.

[GCK]

Yesterday I was getting the same error for a negative number in the proceeds column of my 1099 B form that was downloaded from my broker.  Today I received an update to my Turbo Tax and the error has been fixed.  I still have the negative number for short Put transactions but it does not see it as an error.  So for those of you who have had this error get your updates.  This was as of today (February 18). 

[GCK]

2 Days ago I was getting this same error.  Yesterday ( Feb 18) I got an update to TT and after the update I no longer get this error even though I have negative amounts in the proceeds column from short put transactions.  I download from my broker (Fidelity) all transactions.

[Cass0317]

Please see the TurboTax FAQ below for instructions on how to fix these negative values:

 How do I fix my 1099-B negative values?

[Steven101]

Some experts have magical ways to fix Turbotax's glitch which they blame both the IRS and Fidelity or your brokerage or anyone else they can.  But do common folks like me really have the wherewithal to fix Turbotax refusal to follow IRS and brokerage standards?  The real issue is why won't Turbotax just fix it.  When I've used Turbotax Online before, I enjoyed splash announcement "prepare to be amazed" as Turbotax load all the data automatically from Fidelity.  But this year it's just irritating after I've tried it three times and TT always either inserts an automatic negative zero value or refuses to leave a line blank that should be left blank.  Now it seems someone from Turbotax says the solution is to print it.  I'm not sure that the IRS is going to enjoy that especially since the IRS and FIdelity have made it clear that this is a Turbotax decision to create this glitch with negative values and to make it unfixable by the average user online and to maintain their blame game or tell us ways to fix it ourselves or take a hike or wait.  Which is it?  Wait to April?