Yep, In over my head again

[Karen Lee]

I have a 1099-B for $1,089,436.00, purchases of $1,521,872.57.

Actual out of pocket $106,500.00 with money back of $9,741.86

1099-B would include realized and unrealized losses however I don't know how to report this on Sch D.

All short term

Various buy and sell dates

Please help!!!

Karen

[grandmabee]

1099 b should only incuded actural sales

not unrealized gains or losses. You might be looking at the yr statement not 1099B

[Karen Lee]

Nope, 1099B has the big number but the year end account summary has the realized losses

So are you saying this maybe incorrect?

Karen

[Lion EA]

Using the gains/losses schedule, can you match the sales proceeds to the number on the Form 1099-B? That's your start. If you're talking commodities like silver or soy beans, you can see some big losses.

[taxxcpa]

People who speculate on commodities often sell short, so there may be sales that are outstanding short sales for which there is no purchase transaction.

Also, to keep things confusing, people trade on a very small margin, so you buy $ 100,000 worth of pork bellies for a deposit/margin of 5% --so if the price goes down 5% you lose your whole investment, but if it goes up 5% you double your money.

The broker should also provide a statement showing the actual net results.

[Karen Lee]

I know the net results but don't know how to report it. 1099B shows the sales at over $1mil. His investment was only 106500. less 9741.86 equals net loss. I guess I could report the $1mil sales and plug the cost to net at actual.

Does that sound right?

Karen

[Lion EA]

Report each sale on each date and match up the corresponding purchase date and price from your client's records or the year-end statement if everything was purchased during 2008. Your total sales proceeds should add up to the $1 mil plus amount on the 1099-B. He may have invested only $100,000+ initially, but you said there are many buy and sell dates. He bought $100,000+ of something(s) and then sold some/all and bought something else or more of the same and sold and bought and sold and...until he'd sold over a million dollars worth of whatever. Of course, he also bought. Line up each sale and let your software do the math.

[joanmcq]

Works just like stocks; you can keep buying and selling the same money over and over again. The B lists the total of all the sales, not the net. Look to the year end account summary for the details.