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Schedule
D Tips 
Completing the Schedule
D is increasingly more
difficult each year. Tax laws keep changing, companies
are re-organizing their equity structure more
frequently, and most brokers still do not provide their
customers adequate information for completing their
Schedule D.
Investors receive form 1099-B each
year listing all sell transactions and proceeds.
Investors are then responsible for matching
appropriate purchases against each sell, using original
cost basis figures to calculate gains and losses, and to
calculate holding period for each lot to properly
characterize gains and losses. Sells can be applied
across multiple lots, which could result in both short
and long term gains and losses.
Before an investor can begin gain/loss
calculations, they must first scan their trading history
to see if any trades resulted in a wash sales
transaction. If so, they must make appropriate cost
basis adjustments and defer some of their losses.
Investors also need to modify their
holdings for any corporate actions. A Corporate Action
is essentially any material change to a security,
including name changes, stock splits, spin-offs, and
mergers, to name just a few. In many cases, a corporate
action will result in a new position or a change to the
cost basis of a security. Not surprisingly, it is up to
the investor to make all necessary cost basis
adjustments for each security.
Here are tips to help you successfully
complete your Schedule D.
Holding
periods and gain/loss characterizations
Annual
$3,000 capital loss limit
Wash
Sales
New 5
year Super Long Term tax rate
Are
you an Investor or a Trader?
Presentation
Matters
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