1099 B on the same date has one row with 'Check if Basis Reported to IRS' and 'Check if non-covered security'. How to calculate cost basis for non-covered security?

[mitchokshi]

1099 B from Computer Share has one row with 'Check if Basis Reported to IRS' and 'Check if non-covered security'. One row has 'Cost or Other Basis' and other do not. Both rows are on the same date.

When I go to the transactional details, it has many entries and it is difficult to find the cost basis for the missing one. How do I calculate the cost basis? Should I calculate cost basis for all the entries on that date?

[JamesG1]

All of the securities were purchased on the same date.  Some have cost basis reported and others do not.

Are you saying that the non-covered securities were 'spun off' from the securities that had the cost basis reported?

If so, you may want to allocate the cost that was reported over both the securities that have cost basis reported and the securities that do not have cost basis reported.  If not, you will have to arrive at some basis of reporting the cost basis for the transactions not reported to the IRS.

When you are entering the IRS form 1099-B information into TurboTax Premium Online, make notations on the cost basis by following these steps.

1. When entering the sales information, select The cost basis is incorrect or missing on my 1099-B.  Continue.
2. At the screen We noticed there's an issue with your cost basis, select I know my cost basis and need to make an adjustment.  Continue.

[fanfare]

your consolidated 1099-B tells you which box to check for each transaction, summarized by box.

you have to enter the correct basis yourself for Box E or Box B transactions , OR, accept the incorrect basis.

[mitchokshi]

Thanks for the response. This is how the entries on 1099 B and actual transactions looks like:

Form 1099 B:

Applicable checkbox on Form 8949	Description	Date acquired	Date sold	Proceeds	Cost or other basis	Type of gain or loss	Check if noncovered security	Check if basis reported to IRS
D	51.0691 Shares		10/24/2024	11804.59	7164.3	Long Term		X
X	21.4804 Shares		10/24/2024	4965.21			X
	72.5495

ORDER	PLAN	EXECUTION	QTY	Cost Basis	ACQUISITION
SELL	OWN	24-Oct-24	4.376673	124.5330	5-Jan-22
SELL	OWN	24-Oct-24	10.516173	124.5330	5-Jan-22
SELL	OWN	24-Oct-24	4.548969	115.0195	6-Dec-21
SELL	OWN	24-Oct-24	10.913456	115.0195	6-Dec-21
SELL	OWN	24-Oct-24	3.955730	129.0685	5-Nov-21
SELL	OWN	24-Oct-24	9.490157	129.0685	5-Nov-21
SELL	OWN	24-Oct-24	4.451223	115.3526	6-Oct-21
SELL	OWN	24-Oct-24	10.679087	115.3526	6-Oct-21
SELL	OWN	24-Oct-24	3.947567	127.2683	6-Sep-21
SELL	OWN	24-Oct-24	9.470545	127.2683	6-Sep-21
SELL	OWN	24-Oct-24	0.200533	125.0833	5-Aug-21
			72.550113

[fanfare]

X means they can't tell you what box to check.

in your example it must be either B or E, depending on the holding period.

[mitchokshi]

Yes, I get that and it is also long term with basis not reported. Question is how should I calculate the cost basis for missing row (21.4804 shares)?

[baldietax]

From the info you provided I would multiply the shares by the cost price you have in the second table to get the total $ cost basis; then subtract the $ cost basis for the 51+ shares that did have a cost basis reported, and whatever is left is the cost basis for the 21+ shares.  If you have statements from 2021/2 you can confirm the $ amount from that also.

Looks a bit weird reporting tho why your broker would be missing some cost basis for things on the same dates, seems the 21+ shares without basis are the smaller lots with less than 5 shares acquired on same dates as the larger lots.  The share counts tie out exactly but seems the basis on the 51+ comes to $6227 not $7164.  Anyway check the math, but it may not matter since it's all long term gain, as long as your total proceeds and total cost basis is correct.

If you are inputting manually be sure to use "one by one" for the non covered so avoid being asked to mail the 1099-B to the IRS.

[baldietax]

actually, try to go back to the details from 2021/22 if you can and make sure you have the right cost prices/amounts to base this calculation on, and understanding of how this situation occurred, why they would have cost basis on the larger lots but not the smaller lots with the same acquisition dates.  It's odd to me that the share count if you take all the lots with more than 9 shares you get to the 51.0691 exactly as reported, but the cost basis for that population based on these prices doesn't add up to what is reported.

[mitchokshi]

Hi,

I went back to 2021/22 transactions. Surprisingly the cost basis on the 51+ comes to  $6227 and not $7164 even in the older transactions in detailed statement from computer share.

Not sure now if I report $6227 (as corrected) or $7164 (as per 1099 B).

[baldietax]

ok suggest exploring what else happened to this security since acquisition... did you only have ~51 shares in those statements and the ~21 were awarded later? - I was just looking again at all these pairs by acquisition date, they have the same ratio of ~2.4 to one.  Feels like it was a stock split or spinoff of some sort, so you need to understand what happened to get the right tax treatment and cost basis, I would look thru the later statements to see what happened and when the share count increased and why.  If it was a corporate action there is usually some sort of term sheet which explains the tax consequences and may make sense of how this is being reported (it's possible the basis has been adjusted for some reason and reported correctly, and maybe 0 is the correct basis on the smaller lots if they were awarded as part of a corporate action but you didn't acquire them for cash).

[mitchokshi]

Realized the ~21 are part of match what employer offers while purchasing the shares. So, one row is for the shares purchased and smaller quantity in the other row on the same day is shares matched.