How document step-up basis for 8949 Box E "exception 2"?

Frankly, I think this is a no-brainer. But I'm looking for a qualified second opinion.
Due to a basis step-up, the basis and gain/loss that was entered into Form 8949 Part II "box E checked" (not reported to the IRS) differs from the sum of those transactions in Form 1099-B that the broker sent to me.
(The broker was supposed to do that long ago, but apparently it fell through the cracks before I got involved.)
Following the "exception 2" rule, supporting statements are attached to the tax return to document the proceeds, basis and gain/loss for each transaction.
What supporting statements should be used:
1. The corresponding 1099-B statements, which do not agree with the total basis and gain/loss entered into Form 8949; or
2. My own records, which reflect the basis step-up and which agree with the total basis and gain/loss entered into Form 8949.
Note that I am only asking about supporting statements for Form 8949 Part II "box E checked" transactions (basis and gain/loss not reported to the IRS).
Reply to
joeu2004
Why use supporting statements? Instructions for form 8949 just say to use the CORRECT basis for Box B and E 8949s, and use adjustment B for Box A and D 8949s.
-- Arthur L. Rubin, Brea, CA
Reply to
Arthur Rubin
First, __I__ didn't do anything. A CPA prepared the tax return.
Second, I referred to "exception 2", as the IRS calls it in the Form 8949 intructions, to wit: ``Instead of reporting each of your transactions on a separate row of Part I or II, you can report them on an attached statement containing all the same information as Parts I and II and in a similar format [...]. Use as many attached statements as you need``.
Finally, I am not looking for alternatives. Given the facts as I stated them, I simply want to know which of two sets of information should appear in the supporting statements. (See my original posting for details.)
I think the answer is "obvious". Hint: The "exception 2" rule goes on to state: ``Enter the combined totals from all your attached statements on Parts I and II with the appropriate box checked.``
Reply to
joeu2004
The CPA should have prepared the supporting statements, or, at least explained what supporting statements are needed.
In my opinion, it would be easier to fill out forms 8949 than to prepare an annotate the supporting statements, especially since exception 2 requires the supporting statement to contain ALL the information which would be on forms 8949.
-- Arthur Rubin, Brea, CA
Reply to
Arthur Rubin
My interpretation is that the purpose of exception 2 is as a convenience to the person filing the return when you already have the information in another format. If you have that information, say in your own spreadsheet, it would be easier to attach it rather than copy it all into Form 8949.
You are correct in the case where you would have to create the supporting statement from scratch. Then it would be easier to just use the IRS form.
Reply to
taruss

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