Do TurboTax “Rounded” 1099-B input entries need to be manually “corrected” to be consistent with 1099-B reported to IRS?

[mesquitebean]

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@ chuck6625 wrote:

Unlike previous years, this year TT does not generate 8949 forms for short term transactions which have no adjustments in SchD line 1a.  This is new.

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Since you have no adjustments, see the following paragraph pasted from the IRS instructions for Schedule D.  The emphasis is mine.   In the instructions, prior to this paragraph there is an explanation of what transactions qualify for that method of reporting.

Source:  https://www.irs.gov/instructions/i1040sd

"If you choose to report these transactions on lines 1a and 8a, don't report them on Form 8949. You don't need to attach a statement to explain the entries on lines 1a and 8a and, if you e-file your return, you don't need to file Form 8453."

[Rtmart]

I had the same problem with amounts over $10M. I had to take the millions off both numbers to make it go through. Then I hand wrote an explanation on the form and mailed it separately. Not sure if this will work. Are there plans to fix this?

[chuck6625]

It looks like Turbox Tax fixed this rounding issue for this year filing 2021.

Thank you.

[chigirl]

That would be nice if the program was rounding each trade consistently and correctly, but it is not. I have multiple individual trades that were rounded the wrong direction, leading to incorrect results on BOTH the Form 8949 and Schedule D. The data is correct to the penny, when I go to edit data; it's just the program that is messing up how it appears on Form 8949 and Schedule D. Absolutely ridiculous.

[chigirl]

I had the same issue.

[chigirl]

If it's a ridiculously long form 1099-B, retyping it to correct the program's errors bc Turbotax is unwilling to fix its errors is NOT a solution.

[chigirl]

But that doesn't work if it doesn't round each transaction correctly. And it doesn't round correctly.

[classics6]

This is a serious bug. In my case after rounding thousands of individual transactions, I ended up with 21% more short term gains from crypto (Box C) reported on Schedule D than were reported in the 1099-B summary table. It's even more deceiving because the UI only shows the 1099-B summary, not the incorrectly rounded it actually puts in Schedule D. 

This violates both the accuracy and the maximum tax savings guarantees. https://turbotax.intuit.com/corp/guarantees/.

Incredible that this bug has been present for 2 tax cycles and TurboTax still ignores it.

[StirFry]

I'm having a similar issue with TT Premier.  Can rounding be turned off?

[JulieS]

No, rounding is required by the IRS and can't "turned off". In most cases your totals will be the same or within a few dollars of what your 1099-B summary says. 

Even if you import your sales, you can review them and change the totals just a bit to match your 1099-B exactly. 

To review your sales:

1. Select Federal from the left side menu.
2. Select Wages & Income.
3. Scroll down and look for Investments and Savings, expand the section.
4. Find Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B) and click Start or Revisit to the right. 
5. Click Edit below the 1099-B you want to review.
6. Click Edit or the pencil icon to the right of the entry you want to change. 
7. Make the changes that you need to make.
    

[classics6]

The trade by trade rounding is absolutely NOT required by the IRS. If it were, then all the 1099-B worksheets using Boxes A and D would be rounded the same as those using Boxes B, C, E and F. TurboTax only started rounding the crypto trades (i.e. B, C, E and F) to allow their biggest clients to evade taxes. Those that aren't aware of this "feature" will probably end up paying more than necessary.

Last year I was advised by a member of the Office of the President to take advantage of the feature by splitting all profitable trades into amounts totaling less than $0.50 gains. This way you will not owe any taxes, a feature fully supported by TurboTax under the guise of "the IRS requires us to round this way".  

[fanfare]

the same issue has been raised for many years regarding Box A and Box D. long before crypto was a thing.

I don't think there is any different treatment based on the box category.

[classics6]

Yes they are treated differently based on box category.  When the bug was initially introduced in 2020, all trades started rounding trade by trade. But this made Box A and D trades sum to a different result compared to the forms sent to the IRS from the brokerages. Last year they fixed the bug for Box A and D, but left the loophole open for B, C E and F so you can still use it for crypto. 

I spent way too much time speaking with the office of the president last year about this bug, because this forum is full of misinformation. They are adament that it is a feature, not a bug. And recommended that those that know about it should submit 1099-B with 0 taxes owed in the worst case, or a tax refund (maximize favorable rounding for both losses and gains) in the best case.

They make this suggestion to avoid admitting that they've violated their 100% accuracy guarantee. Instead catering to the big clients looking for tax loopholes.

Again, I spent way too much time speaking with office of the president about this last year. They are very careful with their use of words, avoiding things like bug or loophole or evasion, but did confirm that a single trade with gains of $99 would result in gains tax when using Box B C E or F, but the same trade entered in the worksheet as 200 individual trades with gains of $0.495 would have no gains tax. For Box A and D, both those scenarios would result in the same gains tax.

[Welshie10]

I am still having the rounding issue with Boxes A & D.  I've read posts that said it was fixed.  Unless I'm missing something, the best solution is to make minor adjustments to the downloaded 1099 information to make the totals reported by TT match what's reported as totals on the 1099 correct?

[fanfare]

"the best solution is to make minor adjustments to the downloaded 1099 information to make the totals reported by TT match what's reported as totals on the 1099 correct?"

This is how I used to do it.

make the proceeds come out to match, then adjust the cost of one or more transactions to give you your true gain/loss total.

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Ironically, TurboTax  has taken to suppressing the  Box A/D transactions with no adjustments.

you won't even be able to see what was rounded and how it was rounded on your filed tax return.

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The correct solution is to use aggregation aka enter a summary.
Regarding stock and options, for Box A and Box D, only wash sales have to be itemized on Form 8949.

The other transactions without adjustments can be aggregated. Report the sub-totals of cost and proceeds for those transactions on Schedule D Line 1a or Line 8a respectively.

If you have no wash sales, there will be no form 8949, No attachment is necessary. No mailing is necessary.

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If you have wash sales, it gets more complicated since those adjusted transactions have to be itemized on Form 8949 and the summary totals adjusted accordingly.

Enter the wash sales on Form 8949, then use the subtotal results on the bottom of that form (Line 2) to know how much to subtract which gives you the Schedule D line 1a totals. Be sure to NOT check the adjustments box in the summary window.
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Alternatively, if entry of Wash Sales is too tedious,
summarize and check the box for adjustments and enter the disallowed amount.
This summary will go on Schedule D Line 1b.
You will be making the mail-in election.

mail the transaction details to the IRS within three business days of IRS accepting your e-Filed tax return.