How do I report a gain on collectibles on line 18 of Schedule D?

[Cynthiad66]

@danmunikaplan  please see the instructions below for entering the information necessary for TurboTax to accurately calculate line 18.

Instructions for Schedule D - Line 18 page D-12

Line - 18 If you checked “Yes” on line 17, complete the 28% Rate Gain Worksheet in these instructions if either of the following applies for 2021

. • You reported in Part II of Form 8949 a section 1202 exclusion from the eligible gain on QSB stock (see Exclusion of Gain on Qualified Small Business (QSB) Stock, earlier).

• You reported in Part II of Form 8949 a collectibles gain or (loss). A collectibles gain or (loss) is any long-term gain or deductible long-term loss from the sale or exchange of a collectible that is a capital asset.

Collectibles include works of art, rugs, antiques, metals (such as gold, silver, and platinum bullion), gems, stamps, coins, alcoholic beverages, and certain other tangible property.

Include on the worksheet any gain (but not loss) from the sale or exchange of an interest in a partnership, S corporation, or trust held for more than 1 year and attributable to unrealized appreciation of collectibles. For details, see Regulations section 1.1(h)-1. Also, attach the statement required under Regulations section 1.1(h)-1(e).

Capital gains and deductible capital losses are reported on Form 1040, Schedule D PDF, Capital Gains and Losses, and then transferred to line 13 of Form 1040, U.S. Individual Income Tax Return. Capital gains and losses are classified as long-term or short term. If you hold the asset for more than one year, your capital gain or loss is long-term. If you hold the asset one year or less, your capital gain or loss is short-term. To figure the holding period, begin counting on the day after you received the property and include the day you disposed of the property.

Guide to Schedule D Capital Gains TurboTax

Reporting Capital Gains -

[danmunikaplan]

In order for the tax on capital gains on collectibles to be calculated correctly, code C needs to be entered in column F, part II of Form 8949.  This should trigger an entry into line 18 of schedule D and require use of the Schedule D Tax Worksheet.  The entry screens for 1099-B allow me to report the gain as collectibles, but the program is using the Qualifed Dividends and Capital Gains Tax Worksheet.  I do not know how to correct for this.  

[DianeW777]

No worries.  Follow the information below and you will know you have the correct entry for your collectible sale. Depending on your filing status, you may see all of your income taxed at the same rate.  Keep in mind the 28% rate is a maximum rate that you can be taxed on collectibles. This means that if you taxable income is greater than the amounts below and your ordinary tax rate is higher than 28%, then your gain from the collectibles will not be more than 28%.

1. Net capital gains from selling collectibles (such as coins or art) are taxed at a maximum 28% rate.

Collectibles:

A capital gain rate of 28% applies if your taxable income is more than $40,400 but less than or equal to $445,850 for single; more than $80,800 but less than or equal to $501,600 for married filing jointly or qualifying widow(er); more than $54,100 but less than or equal to $473,750 for head of household or more than $40,400 but less than or equal to $250,800 for married filing separately.

In TurboTax Online or TurboTax CD/Download use the following steps.

1. Once you are in the tax return select Wages and Income > Scroll to Investment Income
2. Select Stocks, Bonds, Mutual Funds, Other > Add more sales (you may need to delete your original entry)
3. Select Other as the sales type > Continue > Enter the Description > Continue
   1. For the download version enter your sales information > Continue > Select the checkbox next to Proceeds from collectibles
   2. For the online version in the top dropdown selection choose 
4. Continue to enter your sale
5. See the image below for both versions for assistance

@danmunikaplan

[danmunikaplan]

Diane W777, Thank you.  I now see how to access the screens you mentioned below and have filled them out, but in the revised return, there is still no entry on line 18 of Schedule D and colum f in Form 8949 is still blank.  Taxes are still being calculated using the Qualified Dividends and Capital Gain Tax Worksheet, and not the Schedule D Tax Worksheet. 

[DianeW777 · Accepted solution]

Thank you for sharing this information. It has come to my attention that our team is working to resolve a situation where the collectible rate might be missing on during the process, so that it does not flag as gains from a collectible and generate the 28% Gain Worksheet.  We apologize for any inconvenience this has caused.

As noted previously, it may not make a difference however you should wait for an update to the software.  Try reviewing the return each day for updates.

[danmunikaplan]

DianeW777, 

Thank you and Turbotax for the follow up and fixing the bug.  The forms and tax calculations are now correct.

I would like a rebate on my $59 filing fee for alerting Turbotax to this issue.  Whom do I contact to request a rebate?   

[MichelleLO]

Please reach out to TurboTax Customer Support to request a rebate.

What is the TurboTax phone number?

[Guest1]

Has this issue been fixed? I am in the process of filing an amended return and it looks like the collectible rate is still not accurate. 

[danmunikaplan]

Yes, I believe it has been fixed.  I manually checked the answer TurboTax gave in on the IRS worksheet, and came up with the same amount that Turbotax did.  That was in February; can't say what it is doing now.  Good luck.