How to Report 1099-B Description of Property

Receiving a Form 1099-B from a brokerage firm is a standard part of the annual tax cycle for anyone who sells assets like stocks, bonds, or mutual funds. This form, “Proceeds From Broker and Barter Exchange Transactions,” details the sales you made during the year. The information it contains is reported to both you and the Internal Revenue Service for calculating capital gains or losses. Understanding the description of the property sold is the first step in translating these transactions onto your tax return.

Understanding the Property Description

The description of the property you sold is located in Box 1a of Form 1099-B. This field identifies the specific asset that was liquidated. For stock sales, this description includes the quantity of shares sold and the name of the company, often represented by its ticker symbol, such as “100 shs AAPL” or “100 Apple Inc.”

Beyond common stocks, Box 1a can describe various other assets. If you sold shares in a mutual fund, you would see the fund’s name and the number of units sold, such as “50 units ABC Fund.” For bonds, the description might include the issuer’s name, the bond’s maturity date, and its coupon rate. You may also encounter abbreviations that clarify the type of security, such as “shs” for shares or “pfd” for preferred stock. Another common identifier is the CUSIP number, a unique nine-character code used to identify North American securities.

Required Information for Tax Reporting

To report the transactions from your 1099-B, you will primarily use Form 8949, “Sales and Other Dispositions of Capital Assets.” You must gather several pieces of information directly from your 1099-B for each sale. The first is the property description from Box 1a, which will be transferred to your tax forms.

Next, you will need the dates associated with the transaction. Box 1b provides the “Date Acquired,” and Box 1c shows the “Date Sold or Disposed.” These dates are necessary for determining whether your gain or loss is short-term or long-term. The financial figures are also needed; Box 1d reports the “Proceeds” from the sale, while Box 1e shows the “Cost or other basis” of the asset. A final piece of information is in Box 12, which indicates whether the cost basis was also reported to the IRS. This detail dictates which part of Form 8949 you will use.

How to Report on Form 8949

The first step is to determine the holding period for each asset by comparing the acquisition date (Box 1b) and the sale date (Box 1c). If you held the asset for one year or less, the transaction is short-term and is reported on Part I of Form 8949. If you held it for more than one year, it is a long-term transaction reported on Part II.

At the top of each part of Form 8949, there are checkboxes that must be selected. For short-term transactions in Part I, you will check Box A if your 1099-B shows that the basis was reported to the IRS, or Box B if it was not. For long-term transactions in Part II, you will use Box D for basis reported to the IRS and Box E for basis not reported.

Once you have selected the correct box, you transfer the information for each sale onto a separate row. The description from Box 1a of the 1099-B goes into column (a) of Form 8949. The date acquired from Box 1b goes into column (b), and the date sold from Box 1c goes into column (c).

You will then enter the proceeds from Box 1d into column (d) and the cost basis from Box 1e into column (e). After listing all transactions, you will total the columns on Form 8949 and carry those totals over to the corresponding lines on Schedule D, “Capital Gains and Losses.”