Question

Schedule D (Form 1040) - Capital Gains and Losses

Accepted Answer

Investors who sold stocks, bonds, options, or other securities will have to prepare Form 8949 and Schedule D for capital gains and losses, and file them along with Form 1040.

Per the Instructions for Form 8949, page 1:

Individuals. Individuals use Form 8949 to report:

The sale or exchange of a capital asset not reported on another form or schedule
Gains from involuntary conversions (other than from casualty or theft) of capital assets not used in your trade or business
Nonbusiness bad debts
Worthlessness of a security

Schedule D. Use Schedule D for the following purposes:

To figure the overall gain or loss from transactions reported on Form 8949
To report a gain from Form 6252 or Part I of Form 4797
To report a gain or (loss) from Form 4684, 6781, or 8824
To report capital gain distributions not reported directly on Schedule 1 (Form 1040), line 13 (or effectively connected capital gain distributions not reported directly on Form 1040NR, line 14)
To report a capital loss carryover from the previous tax year to the current tax year
To report your share of a gain or (loss) from a partnership, S corporation, estate, or trust. (However, corporations report this type of gain or (loss) on Form 8949.)
To report certain transactions you don't have to report on Form 8949, such as transactions reported to you on a Form 1099-B (or substitute statement) showing basis was reported to the IRS and for which you have no adjustments, as explained under Exception 1, later.

Individuals, estates, and trusts also use Schedule D to report undistributed long-term capital gains from Form 2439.

Entering in Program

Form 8949 is automatically generated based upon the individual capital gain and loss transactions entered. It is not directly accessible within the TaxAct® program, but the form will be included with your printed and e-filed return. The information from Form 8949 will then transfer to Schedule D as necessary.

To enter individual capital gain or loss transactions, you will create a Form 1099-B in the program. The information entered on Form 1099-B will then transfer to the appropriate copy of Form 8949.

If you did not receive a Form 1099-B for a transaction, but the transaction still needs to be reported, you must enter this transaction information on a Form 1099-B in the TaxAct program. You will then be able to indicate that you did not receive a Form 1099-B for the transaction, and the appropriate information will transfer to Form 8949 and Schedule D.

To enter this information in the TaxAct program:

From within your TaxAct return (Online or Desktop) click Federal in the Federal Q&A Topics menu. On smaller devices, click in the upper left-hand corner, then choose Federal.
Click Investment Income to expand the category, then click Gain or loss on the sale of investments
Click Capital gain or loss (Form 1099-B)
Click New Copy of Form 1099-B (Desktop users click Add) to create a new copy of the form or click Review to review a copy already created
The program will proceed with the interview questions for you to enter or review the appropriate information. Entries will transfer to Form 8949 and Schedule D as necessary.

Additional Information

For information on reporting the sale of your main home, see Sale of Home. The information entered in this section for the sale of your main home will transfer to Form 8949.

For more information on entering a Form 8949 summary total in the TaxAct program, see Form 1099-B Summary Totals. When using this option, you must have a statement similar to Form 8949 that provides a listing of each transaction you need to report. This statement must contain all of the same information as Form 8949 and must be in a similar format.

Entering in Program

Additional Information

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