Form 8949: Sales and Other Dispositions of Capital Assets (2024)

What the Form Is For

Form 8949 is the IRS form you use to report sales and exchanges of capital assets—investments like stocks, bonds, mutual funds, real estate, and even cryptocurrency. Think of it as the detailed transaction list that shows exactly what you bought, what you sold, and whether you made or lost money on each deal.

The form serves as a bridge between what your broker reports to the IRS (on Forms 1099-B) and what you report on your tax return. Brokers send these forms to both you and the IRS, showing your sales proceeds and sometimes your cost basis (what you originally paid). Form 8949 allows you to provide the complete picture—including any corrections, adjustments, or additional information the IRS needs to properly calculate your capital gains tax.

Capital assets include most property you own for personal or investment purposes: your stocks, bonds, cryptocurrency, your vacation home (though not your primary residence in most cases), precious metals, and even collectibles like art or coins. When you sell these assets, you'll generally need Form 8949 to report the transaction and figure out whether you owe taxes on any gain or can deduct any loss.

The form attaches to Schedule D (Capital Gains and Losses), where your individual transactions are totaled and your overall capital gains tax is calculated. Without Form 8949, the IRS can't verify that what your broker reported matches what you're claiming on your return—and mismatches often trigger audits or correction notices.

When You’d Use It (Late or Amended Returns)

You must file Form 8949 with your tax return (Form 1040) whenever you sell capital assets during the tax year and those transactions require detailed reporting. This typically means filing it by the April 15 tax deadline, or by October 15 if you file for an extension.

However, life happens, and you may need to file Form 8949 outside the normal deadline. If you discover you forgot to report stock sales from a previous year, you'll need to file an amended return using Form 1040-X. In this case, you'll complete Form 8949 for the year in question, attach it to Schedule D, and include both with your Form 1040-X. The same rules apply—list each transaction with complete details so the IRS can verify everything matches their records.

For late returns (returns filed after the deadline for a year you never filed), you'll complete Form 8949 just as you would have for an on-time return. The transaction details don't change based on when you file; you're simply reporting what actually happened during that tax year.

If you receive a corrected Form 1099-B from your broker after you've already filed your return, you may need to amend your return if the corrections change your tax liability. Attach the corrected Form 8949 showing the accurate information to your Form 1040-X.

One important exception: If all your transactions are reported on Forms 1099-B showing that basis was reported to the IRS, and you don't need to make any adjustments or corrections, you can skip Form 8949 and report the totals directly on Schedule D lines 1a (short-term) or 8a (long-term). However, if even one transaction needs an adjustment code or correction, you'll need to complete Form 8949.

Key Rules or Details for 2024

Form 8949 divides transactions into two categories based on how long you owned the asset. Part I covers short-term transactions (assets held one year or less), while Part II handles long-term transactions (assets held more than one year). This distinction matters because long-term capital gains generally receive more favorable tax rates.

The form requires you to check one of three boxes for each category, depending on how your broker reported the transaction. Box A (or D for long-term) is for transactions where your broker reported your cost basis to the IRS. Box B (or E) is for transactions where the broker reported the sale but not your basis. Box C (or F) is for sales not reported to you on a Form 1099-B at all—like property you sold directly to another person.

You must report each transaction separately on its own line, showing eight pieces of information: a description of the property (like "100 shares XYZ Corp"), the date you bought it, the date you sold it, your proceeds (sales price), your cost basis, any adjustment codes, any adjustment amounts, and your resulting gain or loss.

Cost basis is usually what you paid for the asset, including commissions and fees. However, basis can be adjusted for various reasons—inherited property uses the value at the date of death, gifted property uses the donor's basis, and stock splits or dividend reinvestments change your per-share basis. The IRS has strict rules about calculating basis, and getting it wrong is one of the most common errors.

If your Form 1099-B shows incorrect basis information, you must make an adjustment. Enter the basis as reported by the broker in column (e), then use adjustment codes in column (f) and dollar amounts in column (g) to correct the error. Common adjustment codes include B (basis incorrectly reported by broker), W (wash sale loss not allowed), H (home sale exclusion), and L (loss not allowed for personal-use property).

The IRS requires complete information for each transaction. You cannot simply write "various" or "available upon request" in place of actual transaction details, except in very limited circumstances for certain large-volume traders who meet specific requirements.

Step-by-Step (High Level)

Step 1: Gather Your Documents

Collect all Forms 1099-B from your brokers, along with your own purchase records showing when you bought each asset and what you paid. Don't rely solely on broker statements—they may not have complete basis information, especially for older holdings or transferred accounts.

Step 2: Separate Short-Term from Long-Term

Count the time from the day after you bought the asset to the day you sold it. If it's one year or less, it's short-term (Part I). If it's more than one year, it's long-term (Part II). Trade dates matter, not settlement dates.

Step 3: Choose the Right Box

Look at each Form 1099-B. Box 5 tells you whether basis was reported to the IRS. Check Box A or D if basis was reported and is correct. Check Box B or E if basis wasn't reported. Check Box C or F if you didn't receive a Form 1099-B for the transaction. If you have transactions in multiple categories, you'll need to complete separate pages with different boxes checked.

Step 4: Fill in Each Transaction Row

In column (a), describe the property clearly but concisely—"50 shares Apple Inc." works fine. In columns (b) and (c), enter the acquisition and sale dates in month/day/year format. In column (d), enter your proceeds from the sale. In column (e), enter your cost basis.
If these match your Form 1099-B and no adjustments are needed, skip columns (f) and (g) and go straight to column (h) to calculate your gain or loss (proceeds minus basis).

Step 5: Make Adjustments When Needed

If you need to adjust basis or gain/loss for any reason, enter the appropriate code from the instructions in column (f) and the dollar amount of the adjustment in column (g). For example, if your broker's basis is $1,000 too high, enter code B in column (f) and -1,000 (a negative adjustment) in column (g). Column (h) then equals column (d) minus column (e) plus or minus column (g).

Step 6: Total Each Page

Add up columns (d), (e), (g), and (h) at the bottom of each page. Be careful with negative numbers—they reduce the totals. These subtotals carry over to specific lines on Schedule D based on which box you checked.

Step 7: Transfer to Schedule D

Report your Part I totals on Schedule D lines 1b, 2, or 3 (depending on which box you checked), and your Part II totals on lines 8b, 9, or 10. Schedule D then calculates your net capital gain or loss and determines your tax.

Common Mistakes and How to Avoid Them

Mistake #1: Reporting Transactions That Don't Need Form 8949

If all your Forms 1099-B show basis was reported to the IRS (box 5 checked) and you don't need to make any adjustments, you can skip Form 8949 and report totals directly on Schedule D.

Mistake #2: Mixing Short-Term and Long-Term Transactions

Always count the holding period carefully.

Mistake #3: Forgetting to Report Wash Sale Adjustments

A wash sale occurs when you sell stock at a loss and buy substantially identical stock within 30 days before or after the sale.

Mistake #4: Using Incorrect or Missing Basis Information

If you transferred stock from another broker or inherited it, your current broker may not have correct basis information.

Mistake #5: Reporting Sales of Your Main Home

If you sold your primary residence and qualify for the home sale exclusion, you may not need to report it at all—but 1099-S changes that.

Mistake #6: Ignoring Cryptocurrency Transactions

Every taxable crypto event must be reported.

Mistake #7: Not Keeping Adequate Records

Maintain your own documentation indefinitely.

What Happens After You File

Once you file your return with Form 8949 attached, the IRS's computers go to work matching the information you reported against what brokers reported on Forms 1099-B.

If everything matches perfectly, processing continues normally.
If mismatches occur, the IRS may send a CP2000 notice or potentially select your return for audit.

For cryptocurrency, scrutiny has increased significantly.

If you discover your own mistake, file an amended return promptly using Form 1040-X.

FAQs

Do I need Form 8949 if I only received one Form 1099-B showing basis was reported to the IRS?

Not necessarily…

What if my broker didn't report my cost basis to the IRS but I know what it was?

You must report it using Box B or E…

How do I report cryptocurrency transactions on Form 8949?

Cryptocurrency transactions are reported like stock sales…

Can I just round all my amounts to the nearest dollar?

Yes, if you do it consistently…

What happens if I forgot to report a stock sale from last year?

File an amended return using Form 1040-X…

Do I need to report the sale of my primary home on Form 8949?

It depends on whether you received Form 1099-S…

What should I do if the basis on my Form 1099-B is wrong?

Report the incorrect basis, then adjust using code B…

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