IRS-Accurate Schedule D (Form 1040) 2013 Filing Checklist
2013 Unique Status
In 2013, the maximum long-term capital gain tax rate increased to 20% for certain higher-income taxpayers, expanding the rate structure to include 0%, 15%, 20%, 25%, and 28% brackets depending on asset type and holding period. This change resulted from the American Taxpayer Relief Act of 2012, which permanently extended the Bush-era tax cuts for most taxpayers while raising rates for high earners. Schedule D remained mandatory for all capital gains and losses, requiring the completion of Form 8949 before entering lines 1b, 2, 3, 8b, 9, or 10. No stimulus reconciliation, Affordable Care Act provisions, or Tax Cuts and Jobs Act rules apply to 2013 Schedule D.
Year-Specific Programs for 2013
The 2013 tax year introduced an expanded capital gain rate structure, with a new maximum 20% rate on net long-term capital gains for higher-income taxpayers. This required the use of the Schedule D Tax Worksheet to determine the correct tax liability. The 20% rate applied to taxpayers in the new 39.6% ordinary income tax bracket, while the 0% rate continued for those in the 10% and 15% ordinary income brackets, and the 15% rate applied to taxpayers in the 25%, 28%, 33%, and 35% brackets. Additionally, certain capital gains remained subject to higher maximum rates: collectibles gains and qualified small business stock exclusion gains at 28%, and unrecaptured Section 1250 gain from depreciation on real property at 25%. No other year-specific programs, recovery act provisions, or credits apply to Schedule D filing for 2013.
Ten-Step Checklist
Step 1: Gather Transaction Documents
Collect all Forms 1099-B showing proceeds from broker and barter exchange transactions for all securities sales during 2013. Obtain Forms 1099-DIV reporting capital gain distributions in box 2a from mutual funds and other regulated investment companies. Gather Forms 1099-S if you sold real estate during 2013, and Form 2439 if you received undistributed capital gains from a regulated investment company. Collect all broker statements and trade confirmations for the year.
Document the acquisition date and disposition date for each asset to verify the holding period, as this determines whether gains or losses are classified as short-term or long-term capital gains or losses. Organize purchase records showing original cost basis, including commissions and fees paid at purchase, and any basis adjustments such as reinvested dividends or return of capital distributions.
Step 2: Classify by Holding Period
Separate all capital transactions into two groups: short-term capital gains and losses for assets held one year or less, and long-term capital gains and losses for assets held more than one year. The holding period begins on the day after the acquisition date and includes the disposition date.
For example, if you purchased stock on March 15, 2012, and sold it on March 15, 2013, you held it for exactly one year, which qualifies as a short-term holding. If you sold it on or after March 16, 2013, the holding period exceeds one year and qualifies as long-term. Accurate classification is critical because short-term capital gains are taxed at ordinary income rates. In contrast, long-term capital gains receive preferential tax rates ranging from 0% to 20% depending on your income level.
Step 3: Complete Form 8949 Part I (Short-Term)
Before entering any amounts on Schedule D, complete Form 8949 Part I for all short-term transactions. At the top of Form 8949 Part I, check the appropriate box: Box A if the transactions were reported on Form 1099-B with basis reported to the IRS, Box B if transactions were reported on Form 1099-B but basis was not reported to the IRS, or Box C if transactions were not reported to you on Form 1099-B.
List each short-term transaction on a separate row with property description in column (a), acquisition date in column (b), disposition date in column (c), proceeds (sales price) in column (d), cost or other basis in column (e), any adjustments to gain or loss in column (g), and the calculated gain or loss in column (h). If you have more transactions than fit on one Form 8949, use additional copies and check the same box on each page. Complete all short-term transactions before proceeding to long-term transactions.
Step 4: Complete Form 8949 Part II (Long-Term)
Complete Form 8949 Part II with the appropriate box checked for long-term transactions: Box D if transactions were reported on Form 1099-B with basis reported to the IRS, Box E if transactions were reported on Form 1099-B but basis was not reported to the IRS, or Box F if transactions were not reported to you on Form 1099-B. Enter each long-term transaction on a separate row following the exact column requirements as Part I, including property description, dates acquired and sold, proceeds, cost basis, adjustments, and resulting gain or loss.
Capital loss carryover from prior years is reported on Schedule D line 14, not on Form 8949. If you sold your main home and qualify for the Section 121 exclusion, report the sale on Form 8949 with the full sales price in column (d), your adjusted basis in column (e), and enter the excluded gain as a negative adjustment in column (g) with code “H” in column (f).
Step 5: Transfer Form 8949 Totals to Schedule D Part I
Transfer the totals from line 2, column (h) of all Form 8949 Part I pages to the appropriate lines on Schedule D Part I. If you checked Box A on Form 8949 Part I, enter the total on Schedule D line 1b. If you checked Box B, enter the total on Schedule D line 2. If you checked Box C, enter the total on Schedule D line 3.
Add any short-term capital loss carryover from 2012 on Schedule D line 6. This carryover amount comes from your 2012 Capital Loss Carryover Worksheet and represents unused short-term losses from 2012 that are carried forward to 2013.
Combine all short-term items by adding lines 1a through 6 and enter the result on line 7 in column (h). The line 7 result represents your net short-term capital gain or loss for 2013.
Step 6: Transfer Form 8949 Totals to Schedule D Part II
Transfer the totals from line 2, column (h) of all Form 8949 Part II pages to the appropriate lines on Schedule D Part II. If you checked Box D on Form 8949 Part II, enter the total on Schedule D line 8b. If you checked Box E, enter the total on Schedule D line 9. If you checked Box F, enter the total on Schedule D line 10.
On Schedule D line 11, include any undistributed long-term capital gains from Form 2439, box 1a. On line 13, enter total capital gain distributions from all Forms 1099-DIV, box 2a.
Include any long-term capital loss carryover from 2012 on line 14, which comes from your 2012 Capital Loss Carryover Worksheet and represents unused long-term losses carried forward to 2013.
Combine all long-term items by adding lines 8a through 14 and enter the result on line 15 in column (h). The line 15 result represents your net long-term capital gain or loss for 2013.
Step 7: Calculate Net Capital Gain or Loss
On Schedule D Part III, line 16, combine line 7 (net short-term capital gain or loss) and line 15 (net long-term capital gain or loss). This calculation determines your overall net capital gain or loss for 2013.
If the result on line 16 is zero, enter zero on Form 1040 line 13, and you have no further Schedule D calculations. If line 16 shows a gain, proceed to Step 8 to determine the applicable tax rates. If line 16 shows a loss, proceed to Step 9 to apply the annual capital loss deduction limitation. The result on line 16 is reflected on your Form 1040 and affects your total tax liability or refund for the year.
Step 8: Determine Capital Gain Rate Category
If both line 15 and line 16 show gains, you must determine whether any portion of your capital gain is subject to special maximum tax rates. Complete line 18 using the 28% Rate Gain Worksheet found in the Schedule D instructions. This worksheet identifies gains from collectibles such as art, stamps, coins, precious metals, and gems, as well as the taxable portion of gain from qualified small business stock under Section 1202. Enter the result from the worksheet on Schedule D, line 18.
Complete line 19 using the Unrecaptured Section 1250 Gain Worksheet if you sold depreciable real property held more than one year, such as rental real estate. This worksheet calculates the portion of your gain attributable to depreciation that has been previously claimed, which is subject to a maximum tax rate of 25%. Enter the result from the worksheet on Schedule D, line 19. These specialized calculations ensure that different types of capital gains are taxed at the correct rates under the expanded 2013 rate structure.
Step 9: Apply 2013 Capital Gain Tax Rates
If you have a net capital gain on line 16 and your taxable income exceeds certain thresholds, you must use the Schedule D Tax Worksheet found in the Form 1040 instructions to calculate your tax using the new 2013 capital gain rate structure. The long-term capital gain rates for 2013 are 0% for taxpayers in the 10% and 15% ordinary income tax brackets, 15% for taxpayers in the 25%, 28%, 33%, and 35% brackets, and 20% for taxpayers in the new 39.6% bracket.
Collectibles gains and Section 1202 gains reported on line 18 are taxed at a maximum rate of 28%, while unrecaptured Section 1250 gain reported on line 19 is taxed at a maximum rate of 25%. Do not complete lines 21 and 22 if lines 18 or 19 contain amounts, as the Schedule D Tax Worksheet handles these calculations. The worksheet ensures that your capital gains are taxed at the preferential rates while your ordinary income is taxed at regular rates.
Step 10: Apply Capital Loss Limitation and File
If line 16 shows a net capital loss, you may deduct only a limited amount of that loss against ordinary income. Enter the smaller of (a) the loss shown on line 16 or (b) $3,000 ($1,500 if married filing separately) on Schedule D line 21. Transfer this amount to Form 1040 line 13 as a negative number.
If your net capital loss exceeds the $3,000 annual deduction limit, you must carry the excess forward to 2014. Complete the Capital Loss Carryover Worksheet found in the Schedule D instructions to calculate the amount of short-term and long-term capital loss that carries forward to the following year.
The worksheet categorizes carryovers by holding period, which is essential because short-term and long-term loss carryovers are tracked separately. Attach completed Schedule D to Form 1040 along with all Form 8949 pages and any required supporting forms. Sign and date Form 1040 and mail your complete return to the address shown on the IRS Where to File page for 2013, which varies by state and whether you are enclosing a payment. Retain copies of all forms, schedules, and supporting documentation for at least three years.
2013 Schedule D Line Changes
The most significant change for 2013 was the expansion of the capital gain tax rate structure. Before 2013, the maximum long-term capital gain rate was 15% for most taxpayers, with a 0% rate applicable to those in the 10% and 15% ordinary income tax brackets. Beginning in 2013, the American Taxpayer Relief Act added a new 20% maximum rate for long-term capital gains, applying to taxpayers in the new 39.6% ordinary income tax bracket. The expanded rate structure now includes rates of 0%, 15%, 20%, 25%, and 28%, depending on the asset type, holding period, and the taxpayer’s ordinary income bracket.
The Schedule D Tax Worksheet was updated to reflect the new 20% maximum rate and the expanded rate structure. Prior versions of the worksheet calculated tax using only the 0%, 15%, 25%, and 28% rates. The 2013 version incorporates the new 20% rate for high-income taxpayers, requiring additional calculation steps to determine which portions of capital gain are subject to which rates. This change affects the tax computation for taxpayers with substantial capital gains and taxable income exceeding the thresholds for the 39.6% ordinary income bracket.
Form 8949 completion requirements were clarified in 2013 to emphasize that Form 8949 is mandatory for reporting transactions on Schedule D lines 1b, 2, 3, 8b, 9, and 10. While Form 8949 was introduced in 2011, the 2013 instructions provided enhanced guidance on checking the correct boxes and properly categorizing transactions based on whether the basis was reported to the IRS. The clarified instructions helped taxpayers navigate the increasingly complex reporting requirements for capital gains and losses, particularly as more securities became covered under the cost basis reporting regulations.
For professional assistance with your 2013 Schedule D capital gains and losses or any tax filing questions, contact our tax experts at (888) 260-9441.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
