DianeW777
Expert Alumni

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Yes, she does need to file because the filing requirement includes the proceeds of the 1099-B and the 1099-INT even though she has less than the filing requirement when the cost basis is placed on the return. The taxpayer is always responsible for the reporting of the cost basis even though the financial agents are now required to report it as well.  The filing requirement uses 'Gross Income' which is before cost basis.

 

She needs to file her own tax return because the 1099-B cannot be included on your tax return.

The IRS defines unearned income as:

  • Taxable income from investment-type income such as taxable interest, ordinary dividends, and capital gain distributions. 
  • It also includes unemployment compensation, taxable social security benefits, pensions, annuities, cancellation of debt, and distributions of unearned income from a trust and capital gains.

If you have more questions, please provide more clarification as to what types of income are on your tax return, and exactly where you see it under deductions and credits.

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