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Old 05-18-2011, 09:38 AM
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Capital Gains Nightmare

Hello,

I've been looking for a tax community help forum for a number of days and I can't tell you how relieved I am to finally find one. Earlier this year I received a notice from the IRS regarding not filing a Tax Return. I did not file for a particular year because I was not working which was OK, but I was informed I needed to file information regarding Capital Gains on investments. As I am out of work I attempted to file the information on my own and had never attempted this task. As you can imagine, I was totally confused, frustrated, and worried so I phoned the IRS several times seeking assistance with Capital Gains and Losses, Schedule D, Schedule D-1 worksheets, etc. Over the course of two days, I was transferred to several IRS representatives who only served to add to my confusion so I did the best I could and submitted the requested information.

Of course that information was incorrect (two lines were left blank) and I will be assessed fees and penalties if a correct form isn't submitted. I don't know what I'm doing, I'm at a loss, and making myself sick over this situation. Any help will truly be appreciated; I don't know what else to do.

Thank you so much!



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Old 05-18-2011, 11:08 AM
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“Of course that information was incorrect (two lines were left blank) and I will be assessed fees and penalties if a correct form isn't submitted.”--> If you receive any dividends of more than $10 during the given tax year, you need to report it to the IRS. Form 1099-DIV is the document you provide to the IRS with this information. This form gives the IRS information on any ordinary dividends you receive, any qualified dividends -- dividend income that qualifies for low tax rates -- your total capital gains distributions. Information reporting penalties. Any person who does not file an information return or a complete and correct information return with the IRS by the due date is subject to a penalty for each failure. A penalty applies to information returns as follows: Correct information returns filed within 30 days after the due date, $15 each. Correct information returns filed after the 30-day period but by August 1, $30 each. Information returns not filed by August 1, $50 each. ALSO you need to maintain your capital gains transaction register and all supporting documentation for at least 7 years after you file Schedule D/ SCh D-1. The Schedule D will account for your basis and the sales proceeds. If you don't file SCh D, the IRS will assume that the entire amount on the Sch D is taxable gain and you'll get a VERY rude surprise in the mail in about 18 - 24 months when the IRS tries to collect the tax on that!
Please visit the IRS Website here; A Guide to Information Returns
“ I don't know what I'm doing, I'm at a loss, and making myself sick over this situation.”-->I am not sure if this is your situation; however, if you have that many stock transactions, the IRS allows you to attach your brokerage statement as long as it shows a total sales price and total basis. If your broker supplies you with a report that has the same information required by the Schedule D-1, just attach it to your return and enter "see attached," with total gross proceeds and cost basis, on Schedule D. ,i.e., on Sch D, you would write "See _____ (brokerage company) Statement Attached" Then you would put the total amounts on the sales price and basis columns. If you are using a tax software program, it will figure all of that for you. E-file rules allows only one sch D, so if you use a software program, it is designed to accommodate many entries beyond what you may physically see on a form. Effective January 13, 2006, taxpayers can now e-file with multiple Schedule D transactions using the Form 8453, U.S. Individual Income Tax Declaration. Taxpayer's must attach the paper Schedule D-1 or acceptable substitutes to Form 8453. Form 8453 must be signed by the taxpayer and mailed to the Internal Revenue Service within three business days after receiving acknowledgement of tax return acceptance. I guess you may get some help from a tax practitioner in your local area.



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Old 05-18-2011, 12:12 PM
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Stressful Response

Unfortunately I do not have the funds to solicit a tax practitioner. That is how I got into this mess in the first place. Is there a simple software program I can use to calculate Capital Gains information? I do have multiple Schedule D transactions. Maybe I can go to the library to see if that particular software is available.

Effective January 13, 2006, taxpayers can now e-file with multiple Schedule D transactions using the Form 8453, U.S. Individual Income Tax Declaration. Taxpayer's must attach the paper Schedule D-1 or acceptable substitutes to Form 8453. Form 8453 must be signed by the taxpayer and mailed to the Internal Revenue Service within three business days after receiving acknowledgement of tax return acceptance. I guess you may get some help from a tax practitioner in your local area. I don't understand any of this. I am needing some very simple steps/methods to resolve this issue. Thanks so much for responding.


Last edited by ssheperd : 05-18-2011 at 12:16 PM.


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Old 05-18-2011, 12:27 PM
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“Is there a simple software program I can use to calculate Capital Gains information?”--> You may try websites online to find proper software for your needs.
Capital Gains Tax Calculation & Reporting Software - IKeepGainsMoney.com
Capital Gain & Wash Sales Calculator software,Prepare Schedule D (IRS Form 1040)-- Neutral Trend TradeMax®
TradeLog Software | Schedule D, Capital Gains, Wash Sales, Active Trader Taxes


OR ETC..



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Old 05-18-2011, 01:22 PM
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I'll read about each software package thoroughly as I have no room to commit any errors. Upon completion, hopefully I can find a site to submit the finished document online to be reviewed. Thanks so much for the information; I really appreciate it. You have NO idea how worried I've been. Hopefully I can FINALLY get some sleep tonight! Best Wishes!



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Old 05-18-2011, 01:57 PM
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I found the TradeMax program and I can use it at a local service center. Hopefully this program is fairly easy to understand and will solve my issues. Can't thank you enough for the suggestions.



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Old 05-18-2011, 02:22 PM
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Good luck~~



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Old 05-18-2011, 02:53 PM
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You will never believe what I found. An online promotional for Neutral Trend TradeMax Basic Edition. Will I be able to compile IRS Capital Gains Tax with this package? Maybe my luck is changing!



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