1099B trading binaries

[4509]

I have received a 1099B from Nadex for trading binaries last year. The only box with info is Box 8. But Box 8 doesn't appear in Turbo Tax. I made a profit of $55.00. How do I put this into Turbo Tax?

[DaveF1006 · Accepted solution]

1. In your return, go to federal>wages and income All income>Investment Income
2. Show more>Stocks, Mutual Funds, Bonds, Other>start
3. You should reach a screen that says Did or will you receive a 1099-B form or brokerage statement for these sales? YES
4. Next screen you will scroll to the bottom and say you will type it in yourself
5. Then scroll and answer the various questions until you reach a screen that says Now we'll walk you through entering the info on your 1099-B
6. in the first screen, select options since the Binary is an option
7. Next screen will ask if this is a short-term sale or long term.  more than likely, it is short-term.
8. Then answer when it was bought or sold and go down to proceeds and enter the $55 amount.  This is the gain on your option. As for cost basis, leave that blank because since that $55 is profit from the option. 

[mitch4949]

This does not help because Nadex options were traded many many times over many many days. The 1099-B doesn't give that information. Manually entering each and every one of the hundreds of trades is just not doable. There is no way to enter the date in #8 of your post.

[JulieS]

It sounds like maybe your 1099-B form is for 1256 investments or straddles, since you say there are no dates on the form.

If your 1099-B has information in boxes 10 and 11, you need to report this information on Form 6781. Here is how to do that:

1. Select Federal from the left side menu.
2. Select Wages and Income toward the top left.
3. Scroll down/ expand the list and look for Investment Income
4. Find Contracts and Straddles and click on Start or Update to the right. 
5. Answer the first question Yes.
6. Complete the rest of the section to report your gains or losses.

If you actually do have dates on your 1099-B, but just don't want to enter them individually, you can enter your information as summary transactions in TurboTax. This will allow you to enter a summary transaction for all of your sales in the same sales category, for example - A, Short term covered.

1. Select Federal from the left side menu.
2. Select Wages and Income toward the top left.
3. Scroll down/ expand the list and look for Investment Income.
4. Click Start to the right of Stocks, Bonds, Mutual Funds, Other.
5. Answer Yes to Did you sell stocks, mutual funds, bonds, or other investments in 2021?
6. If you land on Your investment sales summary, select Add more sales 
7. On the Let's import your tax info screen, select I'll type it myself
8. Continue and select Sales section totals when prompted to choose how to enter your sales
9. You'll now be able to enter the total proceeds (sales) and cost basis, along with the sales category. Refer to your 1099-B for the amounts and category. When finished, select Continue
10. You can add additional sales totals by selecting the Add another sales total on the Review your sales section totals screen.

[bernardjain2011]

Hello,

None of the explanations above make sense, given the form we receive from NADEX.

I also realize that not enough details were given by whoever asked the question first.  So, please allow me to provide more details.  And with these additional details, hopefully you can guide me (and others in the same situation) on how to enter this information into turtotax. Thanks!  Here it is:

-- The form is small, like a W2.  And mostly boxes are blank.

Here is an example of what you would see for each box.  IF THE LINE IS BLANK THAT MEANS THEY DIDN'T GIVE ANY DATA, OR CHECK ANY BOXES. 

1a REGULATED OPTIONS

1b

1c

1d

1e

1f

1g

2

3

4

5

6

7

8 Profit or (loss) relized in 2021 on closed contracts ( 1,498.23 )

9

10

11 Aggregate profit or (loss) on contracts ( 1,498.23 )

12

13

14

15

16

So there you go... there are only 3 data on the form!  The form is called 1099-B.

Please help us!  How do we enter these wins or losses into turbotax? 

Can you please go step by step with the latest online turbotax version, as in the above descriptions there were things that didn't exist when I was trying to follow them.

Thanks!

[JulieS]

Your 1099-B is showing section 1256 options that you need to report on Form 6781. Here is how to do that:

1. Select Federal from the left side menu.
2. Select Wages and Income toward the top left.
3. Scroll down/ expand the list and look for Investment Income
4. Find Contracts and Straddles and click on Start or Update to the right. 
5. Answer the first question Yes.
6. Complete the rest of the section to report your gains or losses.

[Bsmitty007]

Did you ever figure out how to file these binary options? Im having trouble this year just like you did. 

[DianeW777]

You can report your binary options by using the steps below.  These are investment sales for tax purposes.

1. Sign into TurboTax then select  Wages and Income > Investment Income
2. Show more  > Stocks, Mutual Funds, Bonds, Other > Start or Update
3. You should reach a screen that says 'Did or will you receive a 1099-B or brokerage statement for these sales?'  YES
4. Next screen you will scroll to the bottom and click 'I'll type it in myself'
5. Answer the various questions until you reach a screen that says Now we'll walk you through entering the info on your 1099-B
6. On the first screen select Options (since the Binary is an option)
7. Next screen will ask if this is a short-term or long term sale
   1. Holding period (one year or less = short term/more than one year = long term)  
8. Then enter the date(s) they were bought or sold and go down to proceeds and enter the total sales amount.  
9. This is the gain on your option 

@Bsmitty007  

[Bsmitty007]

There are no dates on the 1099b for any of my trades, just data in box 8 and 11. Are you sure its not contracts and straddles? 

[Bsmitty007]

On an annual basis, Nadex provides information to its members via an IRS Form 1099-B to help you with your income tax compliance requirements. The information provided is based on your activity on Nadex. Nadex’s instruments are considered ‘commodity options’ categorized as ‘swaps’ for regulatory purposes. This may or may not be consistent with the Internal Revenue Service (IRS) categorization for your tax situation. Further, the information contained in the IRS Form 1099-B may not be applicable to or suitable for your specific circumstances or needs, and you may be required to provide other information. Consult your tax advisor before making any filings with the IRS. Nadex does not provide any tax-related advice. For more information on when you can expect to receive your 1099-B, please click

[DianeW777]

You must know the holding period for the binaries.  You can use 'V' for various as the acquired date, and the sales (or expiration) date will be in the current year. The brokerages (not just Nadex) do not keep all data related to these transactions.

• Long term gains, defined as those held for longer than one year, generally have more advantageous tax characteristics than short-term gains, which are held for one year or less.

That being said, it's a great idea to seek a tax professional when you are concerned about all the details necessary for your tax return.  You don't want to pay more than your share of taxes.

@Bsmitty007