1099-B missing info from gifted stock

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Step by Step page says: "Your info should match your 1099‑B exactly. You can add any situations next."

I have a gifted security in the TurboTax sales section "Unknown term basis not reported to the IRS". On my actually 1099-B, it says "Transactions for which basis is not reported to the IRS and Term is Unknown" and my cost basis and date acquired are listed as "Unknown". However, those aren't accepted in TurboTax.

The dropdown for box 1b "Something other than a date" only has one choice: Various (or more than one date). If I attempt to leave the cost basis blank, then TurboTax says "We still need some required info."

There are pages after that which allow me to add cost basis "We noticed there's an issue with your cost basis...Let us know if you'd like to make any changes" and time period "Did you acquire this investment more than a year before you sold it?". However, I'm not sure what to enter on the initial page since it continues to say info is missing even if I make the adjustments on the subsequent pages.

I have TurboTax Home and Business which is not a choice in the product selection for this support page.

AmyCAnswer

Alumni - Intuit

Thanks, @DianeW777!

Why does the screen say "Your info should match your 1099‑B exactly. You can add any situations next."? Are you saying that for missing data the imported blank values should be overridden but for other incorrect values the subsequent correction screens are used? Should I be ignoring the correction screens?

Most people are buying and selling stocks purchased after 2008 so the 1099-B forms are correct and should match. You have a noncovered sale so you are the exception to the rule. Your screen will not match your 1099-B because you have to enter the term and basis in order for your tax forms to be filled in correctly. The date purchased is when donor originally purchased or you can use various.

The correction screens are for when a broker reported a number; but, it is wrong. You don't need those screens.

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DavidD66

Alumni - Intuit

If you received the stock more than a year prior to selling it, you can enter "Various" as the date acquired, and then indicate it is a long-term transaction. For cost basis, you have to enter a number. Your cost basis of gifted stock is the same as the person that gave it to you. If you can't determine your cost basis, you can enter $0.00.

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gbornAuthor

Level 3

Thanks, @DavidD66!

Is the guidance on the TurboTax screen incorrect? It says: "Your info should match your 1099‑B exactly. You can add any situations next." You're saying I should enter the actual cost basis even though my 1099 says "unknown"? What is the point of the following screens then where the interview asks if there are any corrections?

DianeW777

Alumni - Intuit

Yes, you should enter the actual cost basis even though your 1099-B says unknown. The screens must be generalized and it can be confusing sometimes. We are here to help whenever there is a question about your tax situation.

The IRS does know that you have a cost basis and the financial agent doesn't know the cost in your situation (and many other situations). The IRS has specific tax language for what is called covered and noncovered cost basis posted below for your review.

In 2008, Congress passed legislation which required brokers to report the cost basis for securities and mutual funds to both the investors and the Internal Revenue Service (IRS), effective tax year 2011, the difference between covered and noncovered shares is who keeps track of the cost basis.

For covered shares, the financial organizations are required to report cost basis to both you and the IRS.
For noncovered shares, the cost basis reporting is sent only to you.

In your situation the stock shares are 'noncovered', which means only you have the cost basis and it must be entered because you are not required to pay tax on that cost, only the net result, gain (or loss).

@gborn

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