You probably will not like this answer - many people don't - but you get that information from your own records, just like investors have been doing for decades.
The concept of "covered" and "noncovered" securities is very recent and is being phased in, so 1099-B's will continue to report certain sales as noncovered for many years to come.
TurboTax Premier has some assistance available that may be able to come up with a reasonable estimate of basis, but you still need to know an acquisition date for the best accuracy. EDIT: as of the 2014 tax year TurboTax dropped this support.
To reconstruct your basis in the noncovered securities you need to go through old broker's statements - most are now available online - for any securities you purchased directly. Inherited securities have a basis that's the fair market value of the securities at date of death and securities received via "gifts" retain the basis of the donor. And, of course, there's other ways you might acquire securities, too, with yet other basis considerations.
If you can't figure out your basis you might ask a new question, disclosing the security sold and whatever information you do have to see if somebody can assist.
Finally, understand that if you can't really develop a basis that would withstand IRS scrutiny then you pretty much have to use a basis of $0. This results in all the proceeds being taxed, which is not as bad as it sounds because if the holding is long term - as probably most noncovered securities are - the the most likely tax rate is 0% or 15%, which is fairly modest.
You record a noncovered security using the 1099-B interview and providing your own date of acquisition, (if it's not reported on the 1099-B) and your own determination of the security's basis.
For non-covered securities - what this means (regardless if long or short term) is that the broker is not providing the cost basis. You need to provide it. they just handled the sale. If you know when you purchased the security, you can look up the cost basis at - http://www.marketwatch.com/tools/quotes/historical.asp There are other sites out there, but this is the one I used.
Took me awhile to figure it out - see below
In Turbotax - for the 1099-B
- box A - short term covered
- box B - Short term non-covered
- box D - long term covered
- box E - long term non-covered
What if it's INHERITED? No one on the internet can explain. Turbo tax has a drop-down menu of short term, long term. Not covered is either short or long term plus two more. Nothing explained is clear.
I have been reading this strand and it is very helpful; however, I am still having trouble with entering the information. I am doing an estate return and I have a 1099-B. The form has a summary part that lists the Long Term Noncovered and then Long Term Covered and Noncovered (and provides the basis). In the TOTAL REPORTABLE AMOUNTS section it lists the total PROCEEDS (box d) and then the TOTAL Reportable Cost or Other Basis (box 1e). When entering into Turbo tax where do I enter the NON-REPORTABLE basis to bring the taxable amount down to where it should be?
Do you just add it to the box 1e?
When you enter a form 1099-B in TurboTax, if the cost basis is not correct, you should enter it as listed on the form, then click on the "I'll enter additional info on my own" tab to enter the correct cost basis.
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