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Do I need to report a dependent's Proceeds on a 1099B that is $3,000 but cost basis reduces it to a capital gain of only $25? If so, where do I report this? on my return?

Forum|Forum|6 years ago
June 1, 2019
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Best answer by AnnaB

No, since their unearned income was less than the $2,100 threshold for reporting a dependent's unearned income, then you do not need to report this amount. The income is the taxable portion which is the gain, not the proceeds received.

If they file their own return (possibly for a part-time job, etc.), then they should report the Form 1099-B and the minor capital gain on their return as it is income to them.

However, if this is their only income, they are only required to file if their unearned income exceeds $1,050. Therefore, they would not be required to file a tax return.

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AnnaBAnswer

No, since their unearned income was less than the $2,100 threshold for reporting a dependent's unearned income, then you do not need to report this amount. The income is the taxable portion which is the gain, not the proceeds received.

If they file their own return (possibly for a part-time job, etc.), then they should report the Form 1099-B and the minor capital gain on their return as it is income to them.

However, if this is their only income, they are only required to file if their unearned income exceeds $1,050. Therefore, they would not be required to file a tax return.

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Ashley180Author

What if the basis is NOT reported to the IRS? I believe the 1099B only reported the proceeds to the IRS. The basis is Long Term not reportable. This is for each of my 3 kids and almost zero gain/loss. I hate to create a return just for this purpose for each of them.