Investments, Taxes, Form 8949, Schedule D

Selling Investments and the IRS

The IRS is requiring more reporting when you sell your investments.  Specifically, they require you to report the investment cost, cost basis in investment terminology, and the gain/loss from the investment sale.  If you purchase 100 shares of a stock and sell 100 shares of the stock, your cost basis is easy to calculate.  Things get more difficult when you purchase shares in different lots.  For example, you purchase 100 shares in 2011, 50 shares in 2012, 200 shares in 2013 and sell 160 shares in 2014.

Form 8949

What is your cost basis in the above scenario?  This is not an easy calculation to do.  To make things even more difficult, you have to report both your short term gains and long term gains to the IRS separately.  Fortunately, EquityStat makes this easy.  EquityStat calculates your cost basis for each investment and can also generate IRS Form 8949 which is a report that shows your gain/loss on each investment sold.  Your tax preparer can then use Form 8949 to create the IRS Schedule D form.

To Generate Form 8949, click the Tools menu at the top of the portfolio and then click the Generate IRS Form 8949. Choose your tax year and EquityStat will generate the report showing both your short term and long term gain/loss on each investment you sold during the tax year.