On my 1099-B from my Broker, why do I have an item for Noncovered Securities with Undetermined Holding Period for an ETF I bought $300 worth in 2024, but never sold any?

[mrnedburns]

In March of 2024, I bought $200 worth and $80 worth of a BitCoin ETF EZBC through my broker. I've never sold it. Yet my 1099-B Has an entry for the ETF under Noncovered Securities with Undetermined Holding period. Proceeds: September 11, 2024 - $.04. October 11, 2024 - $.04. Quantity 0.00. There is no cost-basis information

[ThomasM125]

It is possible it became worthless in which case you no longer own it, so it is reported as a sale. If so, you can adjust the cost basis to what you paid for it. You will see an option for that when you enter the investment sale information in TurboTax:

[mrnedburns]

Fortunately, that's not the case.  It's actually up about 40% from when I bought it.  Ironically, at the time of this $.08 'sale', it was down a few percent.  I'm baffled.  It says I sold quantity of 0, with proceeds of $0.04, twice.  Cost basis is blank.  I did some math to see how many 'shares' $0.04 would have been on the dates in question, and then assumed the cost of those shares based on my original purchase date.  It was a sliver, which makes me think the quantity of 0 is just from rounding?

It ended up being $0.09.  In the absence any better idea, I think I'll enter short term non-covered, cost basis of $.09 and proceeds of $.08.  Sound crazy?  I really don't want to be audited over 8 cents :(.

[JamesG1]

Whether you report the transaction or not, retain a record of the transaction and all of your computations with your 2024 Federal income tax papers.  

It is hard to imagine that a tax authority will be inquiring about such a transaction at a later time but you never know.

[anandashukla]

Thank you, mrnedburns, for bringing up the question.  I agree for your $0.08 'sale,' you can ignore it, but I want to amplify your question because my total in the same section of my ETrade statement "Noncovered Securities with Undetermined Holding Period" is $122.93, which is an average of about $12/month from March '24 through December '24.

JamesG1 -  I don't know how to report this in TurboTax because I never sold any.  I thought maybe a distribution from the IBIT ETF, but Blackrock's website is clear the ETF doesn't distribute anything.  So I'm stumped on what to do in TurboTax.  Your guidance would be helpful.

Thank you!

[DavidD66]

It sounds like the management fees for the ETF, which are 0.25%, although a portion are currently being waived so the net expense is 0.12% of net assets.  In addition to the Form 1099-B, you should have a supplemental gain/loss statement which will show the shares that were sold and their cost basis.  If you didn't receive a supplemental statement, check your online account or contact your broker/dealer.  

[fanfare]

Don't try to enter 1099-Bs with amount of less than ten cents.

@mrnedburns 

[AuburnBasketball]

Try this. I just talked to Turbo  CPA Tax Expert.  Try this:

1. Put in  "Date acquired"

2. Put in Cost Basis of $ 0

3. Check mark on I paid Sales Expenses

4. Check mark on I don't want to make changes to cost basis

5. Then go on to the next item on the monthly expenses charged.

This worked for me. easy.

[anandashukla]

Thank you, @AuburnBasketball!  I'll follow your very clear instructions!

[mgiam89]

When I click Sales expenses a drop down back appears looking for a value.  What did you enter for the value?

Also what date acquired did you put on?

 

Sales expenses

Sales expenses are for any sales expenses you paid that weren't already subtracted from the gross sale proceeds to get the amount of sale proceeds (reported in box 1d if you have Form 1099-B or box 1f if you have Form 1099-DA).

Sales expenses aren't common for stocks, and other securities (for securities, sales expenses are usually already subtracted from the gross proceeds to get the amount reported in 1d or 1f).

However, if you sold investment real estate, you probably paid sales expenses, such as broker commissions and transfer fees.

Examples of items to include here:

• Wire transfer fees
• Phone or fax fees
• Express delivery fees