My wife has a Robinhood account. Her 1099-MISC form shows a $45 loss. Do we have to file this?

[george10411]

Just wondering if I need to file is we have a loss in the Robinhood account?

[MinhT1 · Accepted solution]

Yes, you have to report your stock transactions in your wife's Robinhood account, even if they are small and she had a loss.

She should have received a form 1099-B.

You can enter your form 1099-B by following these steps:

1. In TurboTax, open your tax return
2. Click on Federal in the left-hand column, then on Wages & Income on top of the screen
3. Scroll down to All Income, locate the section Investment Income and click on Show more
4. Click Start next to Stocks, Mutual Funds, Bonds, Other

[george10411]

I assumed this to be the case but wanted to check. I have since reported this on my return.

Thanks much.

[KathrynG3]

For amounts reported on Form 1099-MISC that are from stock, there are a few extra steps.

The basis in the free stock is equal to the income you received when given the stock. You may need to adjust the cost basis as listed. The sale proceeds would be the amount reported on Form 1099-MISC.

Assuming you received the free stock and subsequently sold it, then you must report Form 1099-MISC and the sale of the stock.

To not be taxed twice on this taxable event, follow these steps to report Form 1099-MISC as received, "back out" the income as a negative amount since it is reported in full on Schedule D, and report the sale of the stock on Schedule D.

Step 1 and 2:

1. From the left menu, select Federal.
2. At Wages & Income, scroll all the way down to Less Common Income and click Show More.
3. Select the last listed option for Miscellaneous Income 1099-A, 1099-C, click Start
4. Next, select the last listed option Other Reportable Income.
5. Did you receive any other taxable income, click Yes.
6. Other Taxable Income: Enter your description including Robinhood Form 1099-MISC as received and the amount and click Continue and Done.
   1. Disregard the comment "Do not enter income from Form 1099-MISC here" because this is meant to guide taxpayers reporting typical 1099-MISC income. Your case is less common and this is how you can report it in TurboTax. 
7. Select Add Another Income Item.
   1. For description, enter Form 1099-MISC reported on Schedule D.
   2. For the amount, enter the same number on Form 1099-MISC as a negative amount. For example, if the first entry was for 10, then the offset would be -10.

Step 3:

1. Click Income & Expenses, the first tab across the top, on the left inside TurboTax.
2. Scroll down to Investment income and Show More.
3. At Stocks, Mutual Funds, Bonds, Other (1099-B) or Cryptocurrency, wherever these details were uploaded or entered, select Revisit.
4. If this transaction is not added, select Add more sales. Otherwise, select Edit/Review to adjust the Proceeds from Sales and Cost basis from sales for this transaction.