How do I record Non-Covered Securities on my 1099B?

[subpopstar]

Like others, I'm finding this thread helpful though it was started last year.

My question is around stock awarded as service awards by my wife's company, i.e. five shares for five years, ten shares for ten years, etc. The company was acquired by a private firm last year and the stock liquidated. The transfer agent handling the transaction coded Box 5 as Non-Covered Securities - Code X (unknown Holding Period). 

Even though it would be simple to go back and determine the quarter in which the stock was awarded is there any benefit to doing so? The cost basis for us is zero since this was simply awarded and we'll pay tax on the entire proceeds, correct?

Final question: How is this coded in TurboTax? The drop-down box had options such as ESPP, NQSO, RSU, etc., but this was none of those; it was simply awarded. What is the correct acquisition designation? 

Thank you for the help!

[TomYoung]

"The cost basis for us is zero since this was simply awarded and we'll pay tax on the entire proceeds, correct?"

It's impossible for anyone here to answer that particular question "definitively."  Employers are not really allowed to make non-taxable "gifts" to employees, except in very nominal, minor amounts.  You can understand why that's so: if employers could make "gifts" of stock to employees then the employer could avoid paying payroll taxes on the "gift", employees could avoid having taxes withheld from these "gifts", and so forth.  So most grants of stock, stock that the employee could sell the day they acquired it, is considered "compensation" and that compensation shows up in the W-2, and the employee and employer pays taxes on that compensation.

"Final question: How is this coded in TurboTax? The drop-down box had options such as ESPP, NQSO, RSU, etc., but this was none of those; it was simply awarded. What is the correct acquisition designation? " 

The correct acquisition designation is that you "purchased" the stock on the date you acquired it and purchased the stock at the same per share "fair market value' the employer used to calculate the compensation reported on the W-2, if any. 

That's not to say that every grant of stock shows up on the W-2.  I'm sure that employers, either through ignorance or guile, omit that on the W-2 meaning that "in effect" the stock was a "gift", though that introduces another wrinkle: recipients of "gifts" inherit the basis of the grantor of the gift.

The "most correct" answer to your question is: go back and look at the W-2s for the year of the grant to see if the stock is included in that year's W-2.  If it is then the basis of the gross number of shares in the grant, before any shares were withheld or sold "for taxes", is the same as that compensation.  Nobody here can look at that information and make a determination.  Only you can.  (Of course if your income is such that the LTCG is taxes a 0%, then there's no point in even determining a correct basis.  You taxes will be the same with or without a basis figure included in the sale.)

[2997]

How do I obtain the Acquired date and cost Basis

[tomandjerry1]

 As Tom has indicated in his entry above, "It's impossible for anyone here to answer your particular question "definitively." ".  For your question, "the Acquired date and cost Basis" depends on what has been sold and how it was acquired.  If this is just a sale of a security which you purchased in a single transaction on some prior occasion and the broker that's made the sale has not supplied the date and cost from the original transaction, then you'll need to consult the settlement statement (or account statements) from when you made the purchase.  If you're selling an aggregate quantity of shares which were acquired on different dates, for varying purchase amounts, then you'll need to gather this from the separate settlement statements you received when making these purchases (which should also appear on you brokerage's account statements).  You would then report the sales for each set of securities using the corresponding date and cost.  The trickiest situation is when you've sold a mutual fund which you've purchased in different amounts at different times and which has then reinvested the dividends the fund pays to add to the shares you own.   In this case I'd refer you to the vast collection of on-line articles you'll uncover by Google'ing "How do you calculate the cost basis for a mutual fund over a long time period" -- start with www.investopedia.com.

[forinterest]

There is no "I'll enter this information myself" option for me.  If I enter the basis and wash information, do I then change the category to A instead of B?

No matter what I enter, this form has a "YES" on the "missing info" checkbox.

How do I circumvent this? Turbo tax is keeping me in a loop on about 12 non-covered security sales.

[DaveF1006]

If the basis is not reported and if these are short-term sales, you report these as category B. For your 12 non-covered security sales, are these summarized or individually listed? Also what missing information is the program asking you to provide?

[forinterest]

I can't determine what TurboTax wants in order to progress. 

There are multiple sales, reduced to 12 entries.  But if I can figure out 1 I can figure out how to handle the other 11.  They need to stay separate in order to keep the wash adjustments easy.

Here is the sequence of events:

1.  Import from broker

  result:  The non-covered securities all have a "YES" for "needs info" column:

2. I click "edit" on one of those entries and the cost basis field is empty and  highlighted in red, and the date acquired is blank also.

2a:  I enter the date acquire and the cost basis on one "interview" page and click "continue"

      result:  turbo tax clears those fields and gives a new checkbox option "allow me to continue with incomplete info" but doesn't progress to a next step. 

3:  I re-enter the same information, check the new "allow me to continue..." option

     result:  it progresses to next screen 

4.  I enter the wash adjustment (Box 1g) and click through the other screens and there is nowhere to specify that (Box 1g) is a W,but it's labled "Wash Sale Disallowed", so it seems like the right place to enter this info.

Everything else I leave blank and click done.

    result:  it progresses to next screen

5. "No, not employee stock"  "continue"

  result: progress to next screen

6.  I leave all the "less common adjustment" checkboxes blank and "continue"

    result:  it goes back to the list of all my sales, still has the "YES" in the "needs info" column, and when I click "edit" none of the information I just entered was captured.  It's all blank again.  I'm missing something that TurboTax wants clarified, but I don't know which option to alter.

I've repeated this a million ways, in forms, with date acquired=Various , I've click inside the individual sale worksheet.  Nothing lets me capture the information.  What TurboTax option is preventing this flow?

[DaveF1006]

Please use this link to  Contact Us to look for the phone number to call live support. Contact them so they can view your screen to see what issues you are encountering.

[forinterest]

Last year I had Premier, this year I have Home and Business. 

[forinterest]

They didn't help me.  They gave me the usual "shut down and restart"  "uninstall and reinstall".  They don't know where to go with this.  I tried multiple things.  I tried deleting the records.  It still won't resolve the overall "1099 B Worksheet "  "Needs Info": YES  checkbox  I also can't open the file once I save and close it. 

This is likely a problem with large 1099s as others are having a similar issue, but no resolution.   

If anyone at turbo tax cares, could someone please help????

[KathrynG3]

It may just be that the import needs to be deleted, the summaries of transactions entered, and the details mailed to the IRS.

See the links for:

• Steps on entering summary investment sales - this is for TurboTax Online, but the principles would still apply for the CD/Download.
• To delete your import: How do I update or delete something I imported into TurboTax?
• Re-importing if not entering in summary: Support with importing your 1099

Please verify that your device meets minimum system requirements. 

Next, make sure the system is fully updated so that it does advance with new information. See: Troubleshoot TurboTax for Windows updating issues.

Here are some more system issue solutions:

• Troubleshoot blank screens, missing buttons, or missing images.
• Troubleshooting problems with Windows Installer and the Microsoft .NET Framework
• Running the Windows System File Checker.

Click the link for support reporting wash sales.

If you do need to call back in, you may need to have them push you a new download if the system will not update. 

@forinterest

[forinterest]

Yes, thank goodness that is an option.  Otherwise I'd have 2000+ transactions.  I have had that many transactions for other years and turbo tax has handled it fine.  There are many folks who have used turbotax year after year and are also having difficulty this year.  I won't be able to trust it next year, so will probably have to look for an alternate solution.  

I can only enter numbers as large as 9,999,999.99.  2000+ transactions adds up to millions.  That's not million in profits, just millions in sales, with the same money over and over again.  I have to hand enter 45 sales to "summarize" this.  

I buy TurboTax on purpose to handle the short term sales.  It has cost me an entire week of trouble shooting.  I have wasted so much time on support that doesn't solve the problem.  I have received information on how to accurately summarize the sales and that's nice to feel confident  that the IRS allows that, but it would be nicer if the software did what the software claims to do.  It has handled my same large data imports in other years.  This year, the software definitely has a problem.  And TurboTax being blank with no technical support phone support, and no technical resolution to this, basically implies that TurboTax isn't intended as a tax solution for those of us in these situations, so we will be force to move on to other software that supports active trading and can handle large data imports.  Thank you for the reply all the same.

[KathrynG3]

We appreciate your feedback. It is an important point about the time involved to  enter in the transactions. It is common to cap entering investment sale transactions up to 25 trades and otherwise enter a summary, instead.

You had mentioned Robinhood as one of the brokers you use. It may be useful to reach out to their support team, as well. See: Robinhood: How to upload your 1099 to TurboTax, which includes a link on the left side of the screen about correcting errors on your 1099.

Otherwise, uploading .txf file details should put data in the order TurboTax uses:

• Service name (examples: Coinbase)
• Asset name (examples: Bitcoin, Ethereum)
• Date of purchase
• Cost basis
• Date of sale
• Sale proceeds

@foirinterest

[Bobcat5001]

 Box A And D are easy and available the others I don't see and it says to use 8949 but that is generated automatically. So I am at a loss on how to enter Uncovered LT Gain in Box E

[JulieS]

You enter long term uncovered transactions in the same place as your other stock transactions.

The difference is that you select Box E in the Sales category drop down and you may need to find your own basis.