Form 1099-B - Aggregating Multiple Stock Transactions

Brokerage firms are required to report stock transactions on Form 1099-B. While the brokerage information may contain multiple transactions, they don't necessarily need to be individually entered in the tax return.

There are two ways to report aggregated transactions:

• Aggregate directly on Schedule D.
• Combine multiple transactions in a single entry on Form 8949.

1. Aggregate directly on Schedule D

On Schedule D, short-term and long-term transactions are aggregated separately, and a transaction can be included in an aggregation if it meets the following criteria:

• Form 1099-B Boxes 1f (accrued market discount) and 1g (wash sale loss disallowed) are blank;
• Form 1099-B Box 2 "Ordinary" check box isn't checked;
• Form 1099-B Box 3 "QOF" check box isn't checked;
• Form 1099-B Box 12 shows basis reported to the IRS;
• The taxpayer isn't electing to defer income due to investing in a QOF, nor terminating deferral from a QOF investment;
• There are no other adjustments needed to the basis or to the gain or loss;
• The type of gain or loss (short-term, long-term, or ordinary) isn't being changed.

Transactions that can't be aggregated are entered on Form 8949.

To aggregate transactions directly on Schedule D in the individual income tax return in Tax Processors Plus Desktop, from the Main Menu of the return (Form 1040) select:

• Income
• Capital Gain Loss (Sch D)
• Other button
• Short Term 1099-B Transactions with No Adjustments
  or
  Long Term 1099-B Transactions with No Adjustments - First enter the aggregate sales price, then enter the aggregate cost.

The amounts entered will flow to Schedule D Line 1a (short-term) or Line 8a (long-term).

2. Combine in a single entry on Form 8949

On Form 8949, you can combine multiple similar entries into one line. For example, you can combine multiple short-term wash sale transactions into one entry, or combine multiple long-term transactions that have no adjustments into one entry.

Caveat: If the taxpayer has brokerage statements from more than one broker, a combined entry should consist of transactions from one broker only.

To enter a combined transaction on Form 8949 in the individual income tax return in Tax Processors Plus Desktop, from the Main Menu of the return (Form 1040) select:

• Income
• Capital Gain Loss (Sch D) - Select New.
  • Description of Property - Enter a description, e.g., "Aggregate short term".
  • Form 1099-B Type - Select the appropriate type.
  • Date Acquired - Choose either Various - Short-Term or Various - Long-Term as appropriate.
  • Date Sold - Enter the last day of the tax year.
  • Sales Price - Enter the aggregate sales proceeds for the transactions.
  • Cost - Enter the aggregate cost for the transactions.
  • Adjustment Code - Check the box for M - Reporting Multiple Transactions on a Single Row, then click Ok.

The combined transaction will be included on Form 8949 in either Part I (short-term) or Part II (long-term).

If any entries are made on Form 8949 using adjustment code M, a PDF copy of the brokerage statement(s) will need to be attached to the return.

Attaching PDF Documentation

Pro tip: If you're scanning a brokerage statement to PDF for e-file purposes, to keep its size low scan in black and white or grayscale (not color), use a low resolution (no higher than 300 dpi), and omit unnecessary pages that don't include transaction info.

To attach a PDF of the documentation showing the details of the transactions that have been combined using adjustment code M, from the Main Menu of the tax return (Form 1040) select:

• Income
• Capital Gain Loss (Sch D)
• Other button
• Attach PDF Document - Select New, and navigate to the PDF document in the Windows File Explorer window, then double-click it.

Note: This is a guide to aggregating Form 1099-B transactions into the Tax Processors Plus Desktop program. It is not intended as tax advice.

Additional Information:

IRS: Instructions for Schedule D

IRS: Instructions for Form 8949

IRS: Publication 550

IRS: Instructions for Form 1099-B Proceeds From Broker and Barter Exchange Transactions