Form 1099 B

[NeiswanderP]

I have a 1099-B form labeled "Proceeds from Broker and Barter Exchange Transactions Box OMB No. 1545-0715" from Morgan Stanley Capital Management. It has been reported to the IRS and is related to a savings account that my wife and I opened last year. I have entries in Box 1d and Box 1e of the 1099-B. The amount in Box 1d is about $50 less than the amount in Box 1e. I haven't had to use a 1099-B before and have no idea if these represent short or long term investments. I picked short term. Does this matter? 

[user17683423020]

Yes, short term (ST) or long term (LT) does matter, because short term capital gain will be taxed as your tax rate while long term have tax favor treatment. You can find out ST or LT by looking at sell date and acquisitions date, or look at the summary page on Form 1099. 

[DawnC]

If you held the security for more than a year, it is long-term.   Less than a year is short-term.    The calculation for a capital gain or loss is straightforward: it starts with the selling price of your capital asset minus its cost basis (what you originally paid for it).    TurboTax does this automatically.  All you have to do is enter the form 1099-B.

How is a capital gain or loss calculated?

Where do I enter or import a 1099-B?

Your total capital gains for the year minus your total capital losses results in either a net capital gain or a net capital loss.

• Short-term capital gains (gains on assets held for one year or less) are taxed as ordinary income.
• Long-term capital gains (gains on assets held more than one year) are taxed at a more favorable rate than ordinary income.

Net losses are deductible, but only up to a maximum of $3,000 ($1,500 if Married Filing Separately). Any capital losses you couldn't deduct this year can be carried forward and deducted on future tax returns. This is called a capital loss carryover.