How to edit Schedule D? Need to move 1099B Box D totals from Line 8a to 8b

[starkyfubbs]

Hello. After entering a summary for each sales category (1099B), TurboTax automatically places my "Box D - Long term covered" amounts on Schedule D Line 8a, instead of Line 8b. It does this I  believe because I do not have adjustments to gain and loss (column g) for my "Box D" amounts. How do I move the "Box D" totals from Line 8a to Line 8b?

Because of this, my "Box D" numbers do not show up on TurboTax's generated Form 8949. But I need to report all the individual "Box D" (and other boxes) transactions on my 8949.

Note I used a trade accounting software to generate my Form 8949. TurboTax can not handle the import of 2500+ trades, nor does it allow uploading pdfs. So ultimately I will need to mail my Form 8949 listing all transactions, along with a Form 8453.

Thank you.

[JulieS]

Yes, you are right, the reason these transaction belong on line 8a is because they have no adjustments.

As long as the numbers are on your Schedule D, you won't have any trouble with the IRS. Box D transactions are fully reported to the IRS by your broker. As long as your gross proceeds match the 1099-B there will not be any problems. 

I am not certain why you are concerned about this if you already have a Form 8949 with all of your transactions that you need to mail in anyway. 

You can force these changes if you want to override all of your entries in the Desktop version, but you will void your accuracy guarantee and will not be able to e-file if you do. 

[starkyfubbs]

Thank you for the response @JulieS.

Apologies, let me clarify. My TurboTax Form 8949 does not list all my transactions. I entered investment sales using the summary total method. Currently my TurboTax Form 8949 says "see attached statement" for my other summaries for Box A/B/E transactions (with codes MW/MW/M respectively). I would like Box D summary to say the same on my TurboTax Form 8949.

Now that I think about it, perhaps I assign Box D with code M? I am not sure. Note Box D transactions do not have any wash sales (one reason it ended up on line 8a).

Because I have wash sales (i.e. adjustments) between stock/options and across all accounts, my 1099B is inadequate. Thus I used a third party program to generate a Form 8949, listing all my transactions. Unfortunately, I could not import the data into TurboTax due to the sheer number of trades. Hence I went with the summary method, and plan to mail in my Form 8949 listing all transactions. Honestly I would prefer not to mail 500+ pages if that was an option. 

It is unfortunate that overriding entries will void accuracy guarantee and disable the e-file option. I understand situations where that is necessary, but in this case it seems silly. I simply wish to choose what Schedule D says in Part II 8a. "However, if you choose to report all these transactions on Form 8949, leave this line blank, and go to line 8b." 

If assigning Box D with code M is not a good idea, how do I proceed to edit/override Line 8a to Line 8b?

[JulieS · Accepted solution]

In checking whether code M causes any additional problems on Form 8949, I stumbled upon a simple trick to move the transactions to line 8b. I hope you are using the Desktop software (from a disc or download) because it doesn't seem to work in the Online version. 

Here is what I did:

1. On the screen that says, Select any less common adjustments that apply, I checked the last option, An adjustment is required for a reason not already covered.
2. I enter 0 in the box that popped up. 
3. This moved the transaction to line 8b and did not cause any other issues. 

[starkyfubbs]

Great! Thank you @JulieS .

I am indeed using a Desktop version. I will try this trick later today. 

(On a side note, I "feel" in older year versions of TurboTax, it was easier to manually edit entries in the forms version. But perhaps I am mistaken...)

[starkyfubbs]

Thank you @JulieS. That trick worked. At first, I did not see "Select any less common adjustments that apply". But I saw it after changing from "I'll enter a summary" to "I'll enter one sale at a time".

Does it confuse the IRS if I mail "Box D" individual transactions, if there is no code M on my 8949 TurboTax summary? I'm leaning towards this just for transparency, since I used a third party program to generate my mail-in 8949, along with a statement saying my brokers' 1099B is inadequate. I already need to mail "Box A/B/E" transactions regardless, since Code M was automatically assigned by TurboTax. (My "Box A/B" had wash sales, and "Box B/E" has no cost basis provided to IRS.)

Reading TurboTax's "Learn more" and 8949 instructions, I think if "Box A/D" do not have any adjustments, then listing just a summary is fine on Schedule D (i.e. no need to list individual transactions on 8949, and thus no need to mail).

Or should I just go back to how everything was in the beginning? Keep line 8b on line 8a on Schedule D. Therefore no summary of "Box D" appears on TurboTax 8949. And I omit "Box D" transactions in my mail-in documents?

[AmyC]

The IRS first checks that income is reported. As long as you are reporting the proper income and paying the correct amount of tax, the IRS is happy. If the IRS decides to question you, be able to show your paperwork trail is accurate and all income accounted for on your return.

You can mail the IRS all the required forms along with any additional items you feel are needed. The best thing is to keep it simple. You want the IRS to open your mail, see what they need and not be confused.

[starkyfubbs]

Thanks @AmyC .

[starkyfubbs · Accepted solution]

@JulieS  Revisiting this thread as I finished and e-filed my return today.

Although the trick to move Schedule D line 8a to line 8b allows you to progress through the tax return on TurboTax desktop, ultimately TurboTax will not let you e-file the return, because it detects an "error" that requires a date entered in the Capital Asset Sales Worksheet (under Form 1099-B Worksheet) for Box D transactions. 

Assigning a code M to Box D transactions, does not work either. TurboTax ignores the code and will still place totals on Schedule D line 8a.

I hope this "restriction" can be addressed by the programming team for future versions of TurboTax, where the user simply wants to enter their 1099-B Box D totals on Schedule D line 8b, instead of line 8a. It is a choice literally stated on the Schedule D form itself: "However, if you choose to report all these transactions on Form 8949, leave this line blank, and go to line 8b." 

[Mike9241]

you do realize that entering D trades on 8b requires you to submit details of each trade to the IRS

from 8949 instructions

code M

See Exception 2 and Special provision for certain corporations, partnerships, securities dealers, and other qualified entities under Exceptions to reporting each transaction on a separate row, earlier. Enter -0- in column (g) unless an adjustment is required because of another code.

exception 2

Don't enter “Available upon request”
and summary totals in lieu of reporting the
details of each transaction on Part I or II or
attached statements.

not submitting detail on multiple trades lumped together on lines 1b or 8b could be construed as filing an incomplete return.

[starkyfubbs]

@Mike9241 Thanks for the confirmation. Yes I was aware that entering D trades on 8b requires you to submit details of each trade to the IRS.

I used a 3rd party trade-accounting program that listed the details of all my trades (A/B/D/E) on 8949, and I am planning on mailing it in, along with a Form 8453. Hence the reason I wanted to enter my D trades on 8b, so my e-file and mailed documents agreed with one another. 

But in order to e-file, I ended up moving the 8b totals back to 8a. 

[Mike9241]

not sure why you would want to incur the cost of mailing the 8949s . it's really none of my business. but Turbotax should have a means of allowing you to do what you want.  the programming was definitely changed from 2020 and earlier years because to get 1a or 8a required entries on those lines dedicated to types A & D and maybe that was the programming earlier in the 2021 tax year.

[starkyfubbs]

@Mike9241 You have a legitimate point. Honestly I would prefer not to mail in 600+ pages of a detailed 8949, if I was aware of an alternative option. But after much research, it seemed like the only way due to the following limitations:

- In 2021, I made 2500+ trades in stocks/options across several trading accounts.

- Could not rely on uploading 1099B into Turbotax, or entering 1099B totals, because brokers do not report wash sales (i.e. adjustments) between stocks/options of the same ticker, and wash sales of the same ticker between different trading accounts. Hence the usage of a third party trade accounting software to consolidate trades, calculate accurate subtotals/adjustments for the e-file 8949, create a detailed 8949 pdf, and creating a digital file detailing each trade to be uploaded in a tax preparation software.

- Unfortunately TurboTax desktop (and online) can not handle the import of 2500+ trades. I forget what the limit is (400 trades?). TurboTax also does not support uploading pdfs. Thus entering totals on my e-file 8949, and mailing in detailed 8949 appeared to be my only option.

- Note although my Box D transactions did not have any adjustments, the trade accounting software has limitations too. I can not easily filter out Box D transactions from the reports. I would have to delete them completely from the program, and that seems ripe for a disaster since I have Box E transactions mixed in.

If you have suggestions on how to better go about this, please do share. I will face the same situation in tax year 2022. Thank you.

[Mike9241]

you may want to see the link.  however, you will always face the same issue with any tax software even professional software when you have multiple a/c's and trade the same securities in those a/c's. none that I have ever worked with, and it's been 6  or more over more than 40 years, are able to detect wash sales. the 1099-B is relied on. 

you'll notice TurboTax says 10,000 trades on the March 2022 thread

https://ttlc.intuit.com/community/entering-importing/help/how-do-i-enter-a-large-number-of-stock-tra... 

[starkyfubbs]

@Mike9241 Thanks for all the replies on a holiday. I trust the trade accounting software that I used (so far).

I am under the impression the 10000 trade limit is for manually entering trades in TurboTax. For importing trades, myself and others start to get error messages when the number of trades is above 2000. I can't find the official response, but users in this thread mention it.

https://ttlc.intuit.com/community/investments-and-rental-properties/discussion/amount-of-stock-trans...

As for the 1099B, I had to ask my broker to review certain transactions this past year, because something seemed wrong. Initially they claimed everything is correct. But upon further review, they finally issued a corrected 1099B. I do not understand it completely, but it seems brokers have the ability to manipulate 1099B's to a certain extent.