Tax & Accounting Blog

Updated 2011 Form 1099-B

1099, Cost-Basis Reporting, Tax Information Reporting, Trust Tax June 22, 2011

With the Emergency Economic Stabilization Act of 2008, payers are responsible for reporting adjusted cost basis information to the IRS on Form 1099-B for covered securities. For 2011, US and non-US issued stock held in a corporation (except where average cost is permissible) acquired on or after January 1, 2011 is considered covered.

In March, the IRS released the 2011 Form 1099-B and instructions with new boxes to accommodate the cost basis reporting requirement. The following boxes were added: date of acquisition (Box 1b), cost or other basis (Box 3), amount of loss disallowed due to a wash sale (Box 5), whether the asset sold is a noncovered security (Box 6), amount of gain or loss (Box 7), and whether the associated gain or loss is short-term or long-term (Box 8).

An updated version of the form and instructions was again released on April 8, 2011. The primary change from the March version of the form and instructions relates to Box 7. The words, “reported gain or loss,” were removed, the box was shaded, and the instructions state the box is reserved for future use.

See www.IRS.gov to download the April version of the final IRS Form 1099-B.