For inherited stock, which was later all sold on the same date, on 1099-B there is a short term covered transaction of a fraction of a share which is a realized gain (Box A short term realized gain), and there are two long term covered transactions, a loss for sale of a fraction of a share and a loss for sale of 80 shares (Box D Long Term Realized Losses).
In the TuboTax interview I selected "Inherited" for the source for all 3 transactions. However on form 8949 for the short term gain transaction there was a code T in column f, which didn't seem right. And all three transactions were listed in Part II, Long Term.
Therefore I changed the short term transaction to "purchased" and the T code no longer appears and that transaction now appears in Part I. Is that the correct way to handle that? In other words, the inherited stock had a stepped up basis and was held for over a year, and there was a fraction of a share that was added to the account before all sold, even though not directly "purchased" by us. However should that fraction of a share be designated as "purchased" rather than "inherited"?
