How do I find the sale category on my 1099-B form?

[Rachel_W]

There may not be actual boxes marked A, B, C etc. on your Form 1099-B, but the information should be on the statement somewhere. (Sometimes it is really hard to spot!)  For example, sometimes it will list "Box D Long-Term Realized Gain" in the summary section.  Or it may list "Box A" at the top of the stock sale listings.

If you are unable to locate the Sale Category on your Form 1099-B, it isn't too difficult to figure out.  

The Sale Category is determined by two factors:

1. Basis reported (Covered) or Basis Not Reported (Non-Covered)
2. Holding period (Long-term or Short-term)

You can use the Box Descriptions below to figure out your Sale Category.

For example, if your stock basis is reported to the IRS on the Form 1099-B, and the stock's holding period was longer than one year, you would select box D as your sales category - a long-term sale with the cost basis reported to the IRS. 

Box A - Short-term Covered - Short-terms sales with cost basis reported to the IRS

Box B - Short-term Noncovered -  Short-term sales with cost basis NOT reported to the IRS

Box C - Short-term Not reported -  Short-term sales not reported to the IRS

Box D - Long-term  Covered - Long-term sales with cost basis reported to the IRS

Box E - Long-term Noncovered - Long-term sales with cost basis NOT reported to the IRS

Box F - Long-term Not reported - Long-term sales not reported to the IRS

Box X - Holding period and cost basis NOT reported to the IRS

[KrisD15]

If an investment is held for one year or less, it's SHORT-TERM

If an investment is held for more than one year it's LONG-TERM

Short-term gain is usually taxed higher than Long-term gains. 

Basis is your value, usually what you paid for something. 

If you buy stock for $2, and sell it for $3, your basis is 2, selling proceeds is 3 and gain is 1. 

If you owned the stock for more than one year, it is a one dollar Long-term gain.

If you owned it for just one year (or less) it is a one dollar Short-term gain. 

Sometimes investments are bought and sold through a Broker and usually the Broker tells the IRS EVERYTHING, what you paid when you bought it, what you sold it for, how long you owned it, and how much you profited from selling it. 

Sometimes the Broker only reports SOME information to the IRS, but not all.

Sometimes you might buy an investment without using a Broker and the IRS is only told about it when you file your tax return. 

COVERED means the IRS was told what you paid to purchase the investment (your basis)

NON-COVERED means the IRS was not told what you paid to purchase the investment

Not-Reported means the transaction was only reported by the Brokerage to the IRS as Long-term or Short-term

Those are the two components 

(How long did you own the investment)

     Short-term OR Long-term

(How was it already reported to the IRS)

          Covered- everything was reported 

          Non-Covered- partially reported, missing what you paid to buy it

          Not-reported- nothing reported 

From these two choices are six possibilities for how the Broker reported the transaction:

                 SHORT-TERM and 

                         Covered- everything was reported 

                         Non-Covered- partially reported, missing what you paid to buy it

                         Not-reported- nothing reported besides how long you held it

OR

               LONG-TERM and

                         Covered- everything was reported 

                         Non-Covered- partially reported, missing what you paid to buy it

                         Not-reported- nothing reported besides how long you held it          

as well as the seventh option (BOX X) where NOT A THING WAS REPORTED TO THE IRS, (not even if it was Short-term or Long-term) 

 the Broker is only reporting a transaction to you