Schedule D, capital gains

No you should not get a letter, the method you used is acceptable. This past tax season one of my client's brokers was able to e-mail me a file with the year's regonized capital gains and losses. It only took about two minutes to arrange the schedule in a manner to my liking in Excel.

Schedule 1040D1. 25 line continuations for STG and LTG. Add as many as needed.

Your broker's statements were probably in a format similar enough to the Schedule D-1 that the IRS has no reason to complain that they didn't get enough informaion. (Item description, date of purchase, date of sale, cost, sale proceeds and Profit/loss). However, your broker probably did not isolate wash sales so you could offset those losses with wash sale adjustments, and for that you can expect some inquiry from the IRS. You only needed two line entries on Schedule D, combining gains and losses for short term on line 2, and long term transactions on line 9 of Schedule D. You should find any wash sales on your broker's statements and make appropriate correcting entries. (unless you use a program to find and adjust them)and report on line 2 or 9 the adjusted amounts. ed

I presume you're asking at this point in time out of idle curiousity. The IRS has a strong preference for the attached detail to present the transactions in a specific format very similar to the format on Schedule D (Schdule D-1 comes to mind). What their reaction is to other formats probably depends on some IRS employee's mood at the time. How about letting us know if you do get any reaction at all from the IRS.

Dan...

Per 2006 instructions for Schedule D you should be OK if your attachments contain the same information as, and a format similar to, Schedule D or D-1. This is in contrast to previous years when the IRS instructed to *not* provide a "substitute" Schedule D-1.

-Mark Bole

More than required.

All you needed was one line in Part I short term, and one line in Part II, long term, each saying See Attached and listing the column totals from your substitute for a schedule D-1. The loss and gain amounts would be combined together into one net figure. If e-filing, you would attach the 200 trasnactions to your form 8453. Next year they will not have any 8453, and it will be interesting to see how they handle this situation.

-- ArtKamlet at a o l dot c o m Columbus OH K2PZH

I just attached several pages of computer printout in 1986, and drew no complaint, though I modelled the information there on what appeared on Sched D. Anyway that was long ago, if you need a long-ago data point.

-- Ron Hardin snipped-for-privacy@mindspring.com

On the internet, nobody knows you're a jerk.

Coincidence - they released the draft 2007 8453 today!

-- Don EA in Upstate NY

Sometimes the right hand doesn't know --- you know.

Wait and see.

I'm shocked!

Wouldn't really surprise me. Never did understand why they needed both an 8453 and an 8879 - seems they could have a single authorization form that would serve both purposes. New York eliminated the state version of the 8453 form two years ago - we now MUST use PINs. But they also still require copies of the C, D, E, etc. even though there's no way to submit paper attachments to the D to the state.

Huh? You're just now filing your 1986 tax return?

ChEAr$, Harlan Lunsford, EA n LA