GainsKeeper – Form 8949 Functionality

Previously, realized capital gains/loss details from the sale of securities were all listed on the Schedule D-1. This year, the IRS has changed the process so details related to gains and losses are included on the supplemental Form 8949. The new form is designed to help the IRS understand the differences between what individuals are reporting on gains and losses and what their brokers reported on the required 1099-B tax form, which summarizes the proceeds of transactions and adjusted cost basis, including wash sale and corporate action adjustments, on covered securities.

GainsKeeper, web-accessible tax software that calculates cost basis adjusted for corporate actions and wash sales, now provides a Form 8949 feature that allows tax professionals and individuals to import transactions from a broker and produce a Form 8949 report.

The new functionality greatly simplifies the challenging calculations tax preparers face as they work to help their clients file taxes on time. For example, some clients may be required to prepare and file up to three copies of the Form 8949: One for securities where both gross proceeds and cost basis is reported on Form 1099-B because they are covered under the cost basis reporting law; one for securities, such as mutual funds, where only gross proceeds but not cost basis is reported on Form 1099-B because the securities weren’t covered under the law in 2011; and one to list transactions, such as options, where neither proceeds nor cost basis is reported on Form 1099-B by the client’s broker.

Not only does the new GainsKeeper technology help relieve tax preparers of the added time and frustrations it would take to manually calculate their clients’ Form 8949s, but it also helps them provide an extremely valuable service to their clients—-particularly those who are active traders or need to consolidate information from various investment accounts onto a single Schedule D.

Contact: Angela Peterson
angela.peterson@wolterskluwer.com
612-656-7745