What Your 1099-B Form Means and Why Your Broker Sends It

Form 1099-B reports the sale of stocks, bonds, mutual funds, and other investments you sold during the year

A 1099-B is a tax form your brokerage or investment firm sends you when you sell securities — stocks, bonds, mutual funds, options, or cryptocurrency. The form lists what you sold, when you sold it, and how much you received. The IRS gets a copy too, so the income from these sales shows up in their records whether you report it or not.

You need this form to calculate your capital gains or losses on Schedule D, the form where you report investment profits and losses. If you sold nothing during the year, you won't receive a 1099-B. If you held investments but didn't sell them, they don't appear on this form — only completed sales do.

The form arrives by January 31 each year for sales that happened the previous calendar year. If you use tax software or work with a tax preparer, you'll enter the information from your 1099-B into your return.

Key Takeaways

• Your brokerage sends you a 1099-B for every security you sold, showing the sale price and the date of the sale.
• You use the 1099-B to calculate whether you made a gain or loss on each investment, which goes on Schedule D of your tax return.
• The form arrives by January 31 and covers all sales from the previous calendar year.
• The IRS receives a copy of your 1099-B, so misreporting or omitting sales can trigger a notice from the agency.
• The cost basis — what you originally paid for the investment — may or may not appear on the form, depending on your broker and the type of security.

What information appears on a 1099-B

The 1099-B shows the description of the security (for example, "100 shares of Apple Inc."), the date you sold it, the gross proceeds (the total money you received), and your broker's name and account number. Box 1a shows the gross proceeds. Box 1b shows the cost basis if your broker has it on file.

Cost basis is what you paid for the investment originally. If you bought 100 shares at $50 each, your cost basis is $5,000. When you sell those shares for $7,000, your gain is $2,000. Your broker calculates this automatically if they've held the investment for you the whole time. If you bought the shares elsewhere or years ago, the broker may not have the original cost and will leave that box blank — you'll have to find those records yourself.

The form also shows whether the sale was a long-term or short-term capital gain. Long-term means you held the investment for more than one year; short-term means one year or less. The IRS taxes these differently, so the distinction matters for your tax bill.

When you receive multiple 1099-B forms

If you have accounts at more than one brokerage, you'll receive a separate 1099-B from each one. If you sold securities at multiple times during the year at the same broker, all those sales appear on a single 1099-B from that broker — you don't get one form per sale.

When you file your return, you'll enter all the sales from all your 1099-B forms onto Schedule D. Tax software usually walks you through entering each form. If you prepare your return by hand, you'll list each sale separately and then total your gains and losses.

What to do if your 1099-B has an error

Check the form against your own records. Verify the sale date, the number of shares, and the proceeds. If something is wrong — the wrong security listed, the wrong sale price, or a sale you didn't make — contact your broker when ready. They can issue a corrected form (a 1099-B with a "CORRECTED" stamp) and send it to you and the IRS.

Don't file your tax return until you have the corrected form. If you file with the wrong information and the IRS notices a discrepancy between your return and the 1099-B they received, they'll send you a notice asking you to explain the difference or pay additional tax.

Cost basis and what you have to track yourself

Your broker reports cost basis on the 1099-B only if they have it in their system. If you bought the investment through that broker, they have it. If you transferred shares from another account or inherited them, the broker may not have the original purchase price. In those cases, Box 1b will be blank or marked "not reported to IRS."

When cost basis is missing, you have to find the original purchase documents — your old brokerage statements, confirmation emails, or purchase receipts. Without the cost basis, you can't calculate your gain or loss accurately. The IRS expects you to report the correct gain or loss even if your 1099-B doesn't show the cost basis.

Some brokers let you specify how you want to calculate cost basis — for example, first-in-first-out (FIFO), last-in-first-out (LIFO), or average cost. If you sold only part of a position, the method you choose affects your gain or loss. Check your broker's website or call them to see what methods they support and which one is selected for your account.

How 1099-B connects to Schedule D

Schedule D is the IRS form where you report all your capital gains and losses. You list each sale from your 1099-B forms on Schedule D, organized by whether it was long-term or short-term. Then you total your gains and losses in each category. If your long-term gains exceed your long-term losses, you have a net long-term capital gain, which gets taxed at a lower rate than ordinary income. Short-term gains are taxed as ordinary income.

If your total losses exceed your total gains, you can deduct up to $3,000 of the loss against other income in that year. Any loss beyond $3,000 carries forward to future years, where you can deduct it again (up to $3,000 per year) until the loss is used up.

Frequently Asked Questions

Do I have to report a 1099-B if I only had a small gain?

Yes. The IRS requires you to report all capital gains, no matter how small. Because the IRS receives a copy of your 1099-B, they know about the sale. Omitting it from your return can trigger a notice.

What if I lost money on a sale — do I still report it?

Yes. Capital losses reduce your taxable gains and can offset other income. Even if you lost money, report the sale on Schedule D so you get the benefit of the loss.

Why does my 1099-B show a different amount than what I actually received?

The gross proceeds on the 1099-B don't include broker fees, commissions, or taxes withheld. Your actual deposit may be lower because the broker deducted those costs. Your cost basis calculation should account for any fees you paid to buy the investment.

Can I file my return before I receive my 1099-B?

You can file early, but you must report all your investment sales. If you haven't received the 1099-B by the filing important date, contact your broker and ask them to send it or provide the information by phone. Filing without reporting a sale that the IRS knows about will result in a notice.

What happens if my broker never sends me a 1099-B?

Contact your broker and ask for the form. If they don't send it by January 31, ask for a written statement of your sales. You're still required to report the sales on your return even if you don't have the official form. Use your own records — statements, confirmations, or transaction history — to fill in Schedule D.