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emc011075, Tax adviser
Category: Finance
Satisfied Customers: 2188
Experience:  IRS licensed Enrolled Agent and tax instructor
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I am doing a tax course and I have to solve a tax question.

Customer Question

Hi - I am doing a tax course and I have to solve a tax question. I have a substitute 1099B that shows shares of stocks sold. The purchase information I have as well as the sold information and shares, but there is a box that has an x in it that says Not Covered. there is a gain on this sale and it is a long term sale..just one transaction..what does Not Covered mean..?
JA: What confuses you?
Customer: Here is the sale Purchased 500 shares in 10/2005 share price 15...cost less commissions is 7500 in Jan 2014 they sold 500 shares for 20, proceeds less comissions is 10,000..leaving a gain of 2500..
JA: The Accountant will know how to help. Is there anything else the Accountant should be aware of?
Customer: So I am assuming after I put this on the correct forms it will flow to linw 13 on my 1040 return..correct?
Submitted: 1 month ago.
Category: Finance
Expert:  emc011075 replied 1 month ago.

Hi. My name is ***** ***** I will be happy to help you.

Not covered means that the basis were not reported to the IRS and you will need to use form 8949 in addition to schedule D to report the basis.

Short term covered with adjustment are reported in box A

Short term not covered are reported in box B

Long term covered with adjustment are reported in box D

Long term non covered are reported in box E

Yes, if you complete Schedule D, the information will flow to 1040 on line 13.

Expert:  emc011075 replied 1 month ago.

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