turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Attend our Ask the Experts event about Tax Law Changes & Forms (2024) on Mar 19! >> RSVP NOW!
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

TerryM45
New Member

How to handle a 1099B for a custodial account

I claim my daughter as my dependent. I have a custodial account for her that sent a 1099-INT and 1099-B in her name. She has no earned income and her only unearned income is from this account and was less than $900 so to my understanding she does not need to file taxes, but I just want to clarify because of the dollar amounts on the 1099-B.  The1099-INT reports less than $900 interest. The 1099-B has $10,000 in Proceeds (box 1d) and $10,000 in Cost Basis (box 1e) with a gain/loss of $0. Do I need to file this somewhere? Thanks for the advice.

x
Do you have an Intuit account?

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

1 Best answer

Accepted Solutions
DianeW777
Employee Tax Expert

How to handle a 1099B for a custodial account

Yes, she does need to file because the filing requirement includes the proceeds of the 1099-B and the 1099-INT even though she has less than the filing requirement when the cost basis is placed on the return. The taxpayer is always responsible for the reporting of the cost basis even though the financial agents are now required to report it as well.  The filing requirement uses 'Gross Income' which is before cost basis.

 

She needs to file her own tax return because the 1099-B cannot be included on your tax return.

The IRS defines unearned income as:

  • Taxable income from investment-type income such as taxable interest, ordinary dividends, and capital gain distributions. 
  • It also includes unemployment compensation, taxable social security benefits, pensions, annuities, cancellation of debt, and distributions of unearned income from a trust and capital gains.

If you have more questions, please provide more clarification as to what types of income are on your tax return, and exactly where you see it under deductions and credits.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

View solution in original post

1 Reply
DianeW777
Employee Tax Expert

How to handle a 1099B for a custodial account

Yes, she does need to file because the filing requirement includes the proceeds of the 1099-B and the 1099-INT even though she has less than the filing requirement when the cost basis is placed on the return. The taxpayer is always responsible for the reporting of the cost basis even though the financial agents are now required to report it as well.  The filing requirement uses 'Gross Income' which is before cost basis.

 

She needs to file her own tax return because the 1099-B cannot be included on your tax return.

The IRS defines unearned income as:

  • Taxable income from investment-type income such as taxable interest, ordinary dividends, and capital gain distributions. 
  • It also includes unemployment compensation, taxable social security benefits, pensions, annuities, cancellation of debt, and distributions of unearned income from a trust and capital gains.

If you have more questions, please provide more clarification as to what types of income are on your tax return, and exactly where you see it under deductions and credits.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
message box icon

Get more help

Ask questions and learn more about your taxes and finances.

Post your Question