Please note that my broker has sent me a 1099B form that showed the stocks are sold based on first comes and first serves, but I think I made mistakes and they should be last comes first serves. Can my broker revise the 1099 B if I let them know that I changed my mind and can I changed my mind?
Yes, you can choose which stocks you sell by giving the proper instructions to your stock broker. The IRS does not prohibit you from choosing the LIFO (last in, first out) method rather than the FIFO method. One disadvantage of the LIFO method is that the lot you are selling is the most recently bought and may be held for less than one year and the capital gains are short-term which are taxed at a higher rate than long term capital gains.
Yes, you can choose which stocks you sell by giving the proper instructions to your stock broker. The IRS does not prohibit you from choosing the LIFO (last in, first out) method rather than the FIFO method. One disadvantage of the LIFO method is that the lot you are selling is the most recently bought and may be held for less than one year and the capital gains are short-term which are taxed at a higher rate than long term capital gains.
When I sold a stock I selected FIFO, but after I got the statement for that transaction, I would like to change it to LIFO, can I still do that ?
Please note that my broker has sent me a 1099B form that showed the stocks are sold based on first comes and first serves, but I think I made mistakes and they should be last comes first serves. Can my broker revise the 1099 B if I let them know that I changed my mind and can I changed my mind?
You cannot change your mind after the sale and the 1099-B has been issued. You have to instruct your broker before the sale that you want to sell on a LIFO basis.
thank you so much! Sorry another question, if I have Turbotax Premier from 2018 (for 2017 tax return), can I use it to do the 2018 tax return (that is due in 2019)? Will the software be updated automatically to the latest version when I am online?
thanks
No, you have to use the 2018 version as tax software is always year specific to take into account the changes in tax laws, tax forms and procedures.
If I bought a Jan 20, 2018 USD 12.50 call option for ABC stock on Jan 10, 2018 & I bought a Jan 20 USD15 call option for ABC stock on Jan 11. On Jan 20, the stock reached $15.50, I had a profit with my Jan 20 USD12.50 call option but I had a loss for my Jan 20 USD15 call option, is the Jan 20 USD 15 call option a wash sale? If the price of the stock in question 1 above did not reach USD 12.50 on January 20, does that mean both the loss due to the two call options on January 20 are wash sales if I purchased 100 ABC stock on Jan 5, 2018 ?
Can you please post this new question in a new thread so that it gets the attention it deserves.
Does Turbotax use the FIFO method for stock capital gain or loss calculation?
turbo tax just takes what your broker provides on the 1099-B, so the decision is made well before Turbo Tax is involved. THAT document already reflects the method (FIFO, LIFO or specific lots) that was used to report stock sales,
So Turbo Tax doesn't use FIFO - or any other method....
you probably have a default method with the broker or the broker uses its own which would normally be FIFO. if you want to use other shares you have to contact the broker before the sale and provide details of what lot you want to sell.
Hi,
I have repeatedly provided my stock broker (Robinhood) with the sale lot pick for TSLA before the sale settlement. I have proof in terms of the emails that I have sent to them.
However, I recently asked them for realized gain/loss so far for 2021, and per the document, they sold my stocks as FIFO instead of my lot pick. Can I use the emails as a proof to IRS so that I can avoid paying capital gains on the sale? I have kept all the TSLA stocks that I purchased in the past year (and even added more). But the way Robinhood sold my TSLA stocks, I will end up incurring a huge tax bill, when I actually have not taken the money out.
Thanks
if you didn't tell the broker to use LIFO before the sale, it's too late now.
The key is ensuring informing the broker in time before the sale that you want to use LIFO and that you receive written confirmation from your broker that verifies that method. If your broker doesn't send that information, then the IRS can conclude that you never made an election and so force you to use the default FIFO method.
Thanks for responding!
The way Robinhood does this is, they ask us to provide that information before the order settles, not necessarily before the sale. I would make the sale, and promptly email Robinhood support with the sale lot pick information. Unfortunately, that is the way Robinhood works for cost basis.
I have all the email that can prove to the IRS of my cost basis method. Does that suffice as evidence to make any changes against the 1099B that is reported to IRS by Robinhood?
Thanks
Can you change your mind before you get a 1099B? Say I chose LIFO as my default and I sell some ABC stock in January for a short term gain while still holding on to some stock in ABC that are long term holdings. I figured I’d probably take more short term losses the rest of the year. However, my subsequent trading from Feb through Nov work out in such a way that my realized short term losses in that time have been offset by short term gains so that if my Jan trade had been FIFO, my total capital gains tax bill would be lower.
Are you bound by your initial choice, or can you change your mind before the end of the year or before you get a 1099-B?
Is it possible to instruct the broker to change the method of accounting from FIFO to LIFO before they report the transactions as FIFO on the 1099-B at the beginning of the year? From my account statements at the brokerage it is clear they are using FIFO, but I want to change all of the transactions from the entire year to LIFO before they issue the 1099B in January.