Solved: Received common stock account and a mutual fund account from passing of brother. I cashed the two accounts out. What is needed for our tax return?
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Received common stock account and a mutual fund account from passing of brother. I cashed the two accounts out. What is needed for our tax return?

Brother had 201 shares Computershare  stock valued at 47.07 each, when he died on 08/26/2018, for  total value of 9461.07.  I cashed out stocks on 12/30/2018 at 45.01 for total value of 8991.86.

Also had Waddell and Reed mutual fund that was worth 121,015.87 on 08/26/2018. Sold funds for 118,629.30 on 12/20/2018.

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Level 12

Received common stock account and a mutual fund account from passing of brother. I cashed the two accounts out. What is needed for our tax return?

You need Premier or above to report your sales.  You'll use the "Stocks, Mutual Funds, Bonds, Other" interview.

You need the 1099-Bs reporting the sales.

You need to know the cost basis of each security at the date of death.  That will be your basis which is subtracted from the proceeds to come up with the gain or loss.  It appears you'll have a net loss in both accounts.

When you sell the stock put the word "inherited" in the date acquired field.  That will make your gains/losses "long term" which they are as a matter of tax law.

Tom Young

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Level 12

Received common stock account and a mutual fund account from passing of brother. I cashed the two accounts out. What is needed for our tax return?

You need Premier or above to report your sales.  You'll use the "Stocks, Mutual Funds, Bonds, Other" interview.

You need the 1099-Bs reporting the sales.

You need to know the cost basis of each security at the date of death.  That will be your basis which is subtracted from the proceeds to come up with the gain or loss.  It appears you'll have a net loss in both accounts.

When you sell the stock put the word "inherited" in the date acquired field.  That will make your gains/losses "long term" which they are as a matter of tax law.

Tom Young

View solution in original post

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Level 4

Received common stock account and a mutual fund account from passing of brother. I cashed the two accounts out. What is needed for our tax return?

First, I would like to express my condolences on the passing of your brother.

You should have received a Form 1099-B for each of the accounts that you cashed out.  

Each Form 1099-B will show the total proceeds from the sale and the date sold. You will need to include your cost basis which is the value on the day your brother died, which you have already calculated.  In addition, if the form does not include a "sale category", you should designate this sale as "long term uncovered" since inherited shares are considered long term holdings.

The information from your 1099-B input will be used to complete Forms 8949 and Schedule D.

To input your Form 1099-B in TurboTax, please follow these steps:

  • Login to your TurboTax Account 
  • Click "Take Me To My Return"
  • Click "Federal" from the left side of your screen
  • Scroll down to "Investment Income" & Click "Show More"
  • Click "Start" next to "Stocks, Mutual Funds, Bonds, Other"
  • From here, TurboTax will walk you through entering your stock and mutual fund sale information

Please comment below if you need further assistance reporting your stock and mutual fund sales.

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