1099B - How to Input Stock Sale with no Cost Basis

[syoung123]

Hello, I have a 1099B stock sale that does not have Date Acquired and Cost Basis.  The 1099B says "Box 5: Non-Covered Securities - Code X (unknown holding period)".  I can get the "date acquired" and the "cost basis" using my own records.  Do I just enter the date on box 1b and cost basis on 1e, or do I need to input the "cost basis" as zero, and then input the cost on my records on box 1g (column g on form 8949) as adjustment? 

[rjs · Accepted solution]

Just enter the date acquired in box 1b and the basis in box 1e. Do not enter it as an adjustment. When you select the "Sales section" select either "Short-term basis not reported to IRS" or "Long-term basis not reported to IRS" as appropriate. Do not select "Unknown term."

[fanfare]

for non-covered with wrong or no basis

enter the correct basis and Code "B" in col(f)

enter -0- in col(g)

@syoung123 

[syoung123]

Hello, thank you all for the replies.  The two replies that I received seem to have different solutions.  My 1099B does not have "date acquired" and "cost basis" (it says "--", so these two fields are blank?), and there is a description says "Box 5 with Code X" (unknown period).  The reply from "rjs" says to input the acquired date and cost per my own records to column b (date acquired) and column e (cost), and leave column f and g blank (since it is not adjustment, the broker just didn't provide the info) on form 8949.  The reply from "fanfare" says to put code "B" on column f and "0" on column g.  Please clarify which way that I should do?  Thanks much.

[MarilynG1 · Accepted solution]

Keep it simple.  If you have documentation of Date Acquired and Cost Basis, use those amounts (save the documentation).  

Indicate Short or Long Term.

Yes, you are not Adjusting, you are providing what the broker didn't.

Here's more info on No Date Acquired, No Cost Basis on 1099-B. 

@syoung123 

[revik]

rjs gave you the best advice assuming that you have the information needed to comply.  For a very long time brokerage houses were not required to keep track of your acquisition prices and dates, so they didn't.  Your brokerage obviously doesn't have that information on your stock sale, but you should.  The best way to avoid IRS scrutiny is to enter that information from your own records and indicate that it was not reported to the IRS by your brokerage.  They didn't report it because they don't have it.  Most likely this is a long term asset because brokerage houses are now required to keep that information on file and report it to the IRS when you make a sale.  Without a declared cost basis for your asset, the IRS could impose taxes on the entire gross amount of your sale.

[syoung123]

Thank you all for your replies and clarifications.

[Foozy]

My 1099b does not have the cost basis or acquisition date. However the information was available to the brokerage (Fidelity) because the cost basis and date were on the monthly statement when I sold the stock.  The stocks were acquired in my brokerage account as vested RSU from a net benefits accounts also at Fidelity. So all the information was available for the 1099b but not reported. There is a supplemental tax form, not reported to the IRS, that has the cost information. 

[DavidD66]

The basis not being reported on the 1099-B is normal for stock acquired through an employer plan, which includes RSUs.  You will have to "adjust" the cost basis and acquisition date, and enter the correct amounts.  When you first enter your sales information, leave the cost blank, or put zero.  Go ahead and add the acquisition date.  After you enter it, you will be asked on a subsequent screen if you need to adjust it.  Indicate yes, and enter the correct cost basis.  

You should check to make sure that the amount of the supplemental schedule is correct.  Your cost basis is the value of the underlying stock when the RSUs vested.  That is also the amount that was treated as earned income and included in your Form W-2, box 1.  The amount may also be noted in Box 14 of your W-2.

[stlucia95]

What happens when you don't know when it was acquired at all and the cost basis is unknown?  Many thing happen during the life of our portfolio which revolve around spin offs.  These are not discussed with us on a monthly basis so we wouldn't know in real time when it was purchased.  Sloppy or poor customer service on the part of my brokerage. 

[stlucia95]

Edward Jones is still slack in this department.  Every year they do this on our reporting.  So if I don't have it I'm forced to report LT and take the full hit for selling the asset.