Always check the prior year’s tax documents for carryover losses. If we did the return last year, it should appear correctly.
Tax Slayer entry:
Federal Section > Income > Capital Gain and Losses (Schedule D)
Capital Gains and Loss Items:
- Each transaction (or “various”) if a group of transactions must be entered individually.
- There is no need to enter the Form 8949 A-F transaction codes. Appropriate questions will produce the codes as the return is produced.
- TaxSlayer has no provision for type A and D (reported to IRS) transaction totals to be entered directly on Schedule D.
Using summaries from a broker statement:
Simply use the summary of each type of transaction total:
- If ACA exemption testing will be required, enter gain and loss totals as separate entries so that TaxSlayer can do Gross Income tests correctly. If there are multiple transactions, use code “M”.
- Wash sales resulting in a loss must be adjusted by using a code “W” and enter the loss amount as a positive number.
- Tax-Aide is no longer required to submit Form 8453 with broker statement and relevant 8949 pages. Advise the taxpayer to retain copies.
Other Captial Gains Data
- Check the previous year tax return for any short or long carryover losses to enter here.
Sale of Main Home Worksheet:
- See the Sale of Home Scoping Decision Tree to determine if the sale of the home is in scope.
- See the Buying and Selling a Home web page for items on the HUD-1 statement that affect basis or may be deductible. The worksheet has pages that will ask for entry of various purchase and selling expenses and improvements made, etc.
- If it’s the main home, lived in 2 of the last 5 years, the gain is less than the $250K/$500K exclusion and there is no 1099-B or 1099-S, the sale can be ignored.
- The exclusion, once used, cannot be used again for 2 years.
- If widowed, figure one half the value of the home at the death of the spouse and increase the basis at that time by that amount. Then add in any capital improvements made since that time to figure the new basis. If sold within 2 years of the spouse’s death, the full $500K exclusion can be used. See Pub 523 for a worksheet to help figure the gain or loss.
- If the sale price of the home is more than the exclusion amount, consult with your local coordinator to help determine if the sale is in scope.
- Note: moving expenses are OUT OF SCOPE unless certified for Military.
- If the client took the First-Time Homebuyer credit in 2008,
- a form 5405 is required for each of the TP and SP if the credit was taken in 2008 on a joint return
- the remaining unpaid portion will have to be repaid unless:
- The home was destroyed or condemned, or disposed of under threat of condemnation and a new home was not acquired within 2 years of the event, or
- TP/SP is military/Foreign Service/intelligence and received government orders to serve on qualified official extended duty. (OUT OF SCOPE unless certified for Military)