Form 1099-B small amount

[Sydd7]

I received, for the first time ever, a 1099-B form.

The info is as follows:

SOLD:1C - 0701/2020

PURCHASED: 1B - 11/23/2015

PROCEEDS: 1D - 33.63

COST BASIS: 1E - 4.78

GIN/ LOSS: 28.65

Do I need to file these? The only reason I ask is because it's literally the only 1099-B I got and it's such an insignificant amount.

[HelenC12 · Accepted solution]

Yes, you have to claim the Form 1099-B on your income tax return no matter how small. 

If you're required to file an income tax return, generally, any amount included in your income is taxable unless it is specifically exempted by law. Income that is taxable must be reported on your return and is subject to tax. Income that is nontaxable may have to be shown on your tax return but is not taxable.

• A list is available in Publication 525, Taxable and Nontaxable Income.

You may be able to use the IRS Free File Program.

• The IRS Free File Program delivered by TurboTax is geared towards lower-income filers, regardless of tax return complexity, and is only offered through the IRS Free File Alliance (FFA) program. No upgrades are available.

[MamaDeerinSnow]

I have a similar issue with a 1099-B for $27 for a "cash liquidation", apparently of common stock from the Box1a description of property. The information is not complete--no date acquired, only a date sold or disposed; no cost or other basis; no wash sale loss disallowed.  This for a spinoff of part of a company I've invested in for many years.  I would be happy to report it, but I have no idea how to do that with the incomplete information, let alone determine short-term or long-term.

Thoughts?

[DianeW777]

Here is what you need to know.

Liquidating distributions, sometimes called liquidating dividends, are distributions you receive during a partial or complete liquidation of a corporation. These distributions are, at least in part, one form of a return of capital. They may be paid in one or more installments. You will receive Form 1099-DIV from the corporation showing you the amount of the liquidating distribution in box 8 and/or 9.

Any liquidating distribution you receive is not taxable to you until you have recovered the basis of your stock. After the basis of your stock has been reduced to zero, you must report the liquidating distribution as a capital gain. Whether you report the gain as a long-term or short-term capital gain depends on how long you have held the stock.

If you have recovered your cost basis and now need to report capital gains use the information at this link.  You will have 'sale proceeds' but zero cost basis. The sales proceeds will be any part of the liquidating distribution that is in excess of your original cost basis.

• Where do I enter a capital gain?

Cost is zero - Date acquired will be 'Various'. Select the correct holding period (long term if you held the stock for more than one year or short term if you held the stock one year or less). Select the check box next to use something other than a date (Online) then enter Various.

[MamaDeerinSnow]

Does it change things at all to know that this is cash liquidation of a fractional share in a spinoff where shareholders received 2 shares of the spinoff for every 1 share of the parent company.  So I think clearly short term, but this is not something that logic alone will solve. 

Thanks