Capital Gains Reporting

Capital Gains, Minimal Taxes: The Essential Guide for Investors and Traders

The rules for reporting capital gains and losses changed dramatically during the 2010’s. For the first time, brokers are required to report not only sales proceeds but also, for many transactions, basis and holding period. These rules first applied to shares of stock in 2011. In 2012 they apply to mutual fund shares and dividend reinvestment plans, and in 2014 they apply to bonds and options.

In connection with these reporting rules, the Treasury issued regulations changing the way averaging applies to mutual funds and, for the first time, making averaging available for dividend reinvestment plans. Various other rules changed also, and the IRS created a new form to relieve some of the burden from the venerable, and overworked, Schedule D. Here are some pages dealing with capital gain reporting issues.

Covered Securities and Noncovered Securities
The distinction between covered securities and noncovered securities is important to anyone who deals with the tax consequences of buying and selling stocks, mutual funds, or other financial instruments.

Easier Capital Gains Reporting
You may not have to report each individual transaction.

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