tradecrumbs, I have a very experienced tax man that also trades.........but that doesn't mean he can figure out IB's puzzle. I will be sharing the information that I am getting here with him. Ron
jack the total amount on line 2 from ib's d-1 they give you is the correct amount of ALL YOUR STOCK,OPTION AND BOND TRADES. as i said you can use ib's d-1
John: The number may or may not be correct. Let's say I sold a Put for $10 on stock X and got a $2.00 premium for the Put. THe stock declined and the Put was exercised. I therefore bought Stock X for $10. The purchase does not show on the D1 unless I sell the stock. I still own the stock X at year-end. My basis in the stock is $8 ($10 - $2) and I have not sold it yet. Therefore the proceeds of the Put sale ($2 x 100) are not taxable this year and should not be included in the D1 total. Another example. I sell a short. I have not closed my position. I believe that IB will show the sale proceeds. I will not stand behind this statement as it has not happened to me but I suspect that is what will be the case. Jack
my sales for bonds on IB's schedule D-1 totally screwed. for example- basis for purchase for 5000 CIT 2 7/8 9/29/2006 bond is 4931(5 bonds). sales reported by IB is 8000. at same time total proceeds on 1099 for all transaction(long term bonds mentioned above included) are correct. i guess i have to go thru every transaction after i saw this...i was really impressed by IB work,when they put all my transactions on IRS forma and i can print them and attach to my return, but as usual something is screwed big time..
thats true. but for 99% of people its pretty accurate. thats why there might never be mandatory sch d's for brokers as nobody can take into account all variables such as the one you mentioned or people transferring in stocks from other brokers.
Mine is totally screw, i don't even trade bonds just stocks and futures. The gross proceeds on 1099 and schedule D-1 total is off by 200k.
For past years, this has been the case for me with the gross proceeds reported by IB on the 1099. For all of my open short stock positions at each years end, IB reported the sales amount of those short positions in the gross proceeds reported on the 1099. As a result, every year I have had to explain to the IRS why the gross sales proceeds on the 1099 did not match that shown on my schedule D. None of my other brokerage accounts report short sales proceeds on the 1099 for short sale positions still open at the end of the year. For 2006, the schedule D generated by IB is within 5 cents of the schedule D generated by my accounting software. I had only stock transaction with IB for 2006.
My cpa talked to an IRS agent who told him that they strip the trade detail from returns and throw it away. I used to send in 70-100 pages, 1 trade per line to backup 1 line per broker on schedule D consolidating the cost/proceeds. Last year I sent nothing but the consolidated cost/proceeds with a note that detail is available on request. No problems so far.
cotossa i don't believe that. i've been trading a long time with 20 or more brokers and i've yet to see a broker who didn't report any sale. all sales are reported wether you close it or not. how you account for that is easy. lets says you have 500 shares short of ebay open at 25k sales proceed. simply have the gross cost equal the sale and put in parenthesis next to the stock symbol open short covered in 2007. i've been doing that for 15 years no problem. you've washed it out for no profit or loss still you close next year