What a 1099-B Form Reports About Your Investment Sales

A 1099-B reports the sales you made of stocks, bonds, mutual funds, and other investments during the year

A 1099-B is a tax form that your brokerage or investment firm sends you when you sell securities — stocks, bonds, mutual funds, options, or similar investments. The form lists what you sold, when you sold it, and how much you received. Your broker is required to send you this form by January 31 if you had any sales activity in the previous year, and they also send a copy to the IRS.

The purpose is straightforward: the IRS wants to know about investment sales so they can match them against the gains or losses you report on your tax return. If you sold 100 shares of a stock for $5,000, that transaction appears on your 1099-B. The form helps the IRS verify that you reported the correct amount of income from those sales.

You may receive multiple 1099-B forms if you have accounts at different brokerages, or even multiple forms from the same brokerage if you have different account types (like a regular brokerage account and an IRA). Each form covers only the sales from that specific account.

Key Takeaways

• A 1099-B lists every security you sold during the year, including the sale price and the date of the sale.
• Your brokerage sends you a 1099-B by January 31 and also sends a copy to the IRS to verify your reported investment income.
• The form shows proceeds from the sale, not profit — you calculate your actual gain or loss by subtracting what you paid for the investment.
• You need the 1099-B to complete Schedule D on your tax return, which is where you report capital gains and losses.
• If you have accounts at multiple brokerages, you will receive a separate 1099-B from each one.

What information appears on a 1099-B

The form shows the description of each security (the company name and ticker symbol), the number of shares or units sold, the date you sold it, and the gross proceeds — the total amount you received before any fees or taxes. For stocks, it might show "100 shares of Apple Inc. (AAPL) sold on March 15, 2024, for $18,500."

The 1099-B also includes a cost basis section, though this varies depending on your broker and the type of account. Cost basis is what you originally paid for the investment. Some brokers calculate this automatically if they have records of your purchase; others leave it blank and you have to provide it yourself. The difference between the sale price and the cost basis is your capital gain or loss.

The form identifies whether each sale was a short-term or long-term transaction. Short-term means you held the investment for one year or less; long-term means you held it for more than one year. This distinction matters for taxes because long-term capital gains are usually taxed at a lower rate than short-term gains.

How the 1099-B connects to your tax return

You use the information from your 1099-B to fill out Schedule D, which is the form where you report capital gains and losses. Schedule D is part of your overall tax return (Form 1040). You list each sale on Schedule D, calculate your gain or loss for each one, and then total them up to see whether you had an overall gain or loss for the year.

If you had a net capital gain (you made more money than you lost), that gain is added to your taxable income. If you had a net capital loss, you can use up to $3,000 of that loss to reduce your other income in that year, and you can carry any remaining loss forward to future years.

The IRS receives a copy of your 1099-B directly from your broker, so they know what you sold and for how much. If the gains or losses you report on Schedule D do not match what appears on the 1099-B, the IRS will notice. That is why it is important to reconcile the form with your own records and make sure your reported numbers are accurate.

When you might not receive a 1099-B

If you did not sell any investments during the year, you will not receive a 1099-B. The form is only issued when there is a sale transaction. Holding investments without selling them does not generate a 1099-B, even if the value went up.

Some types of accounts are exempt from 1099-B reporting. Traditional IRAs, Roth IRAs, 401(k)s, and other retirement accounts do not generate 1099-B forms for sales within the account, because the IRS does not tax those internal transactions. You only report income from retirement accounts when you withdraw money from them (and that appears on a different form, like a 1099-R).

If your brokerage account is very small or you only made one or two trades, you should still receive a 1099-B if there was any sale activity. There is no minimum threshold — even a single $100 stock sale triggers the form.

Cost basis and what you need to track

The most important number on a 1099-B is often the one that is hardest to find: your cost basis. This is what you paid for the investment originally. Your broker may have this information if they held the investment for you from the time you bought it, but if you transferred the investment from another broker or bought it years ago, the cost basis section might be blank or marked as "unknown."

If cost basis is missing, you have to provide it yourself. This means going back to your old statements or trade confirmations to find out what you paid. Without accurate cost basis, you cannot calculate your actual gain or loss, and you cannot complete Schedule D correctly.

Some brokers let you choose how to calculate cost basis if you sold only part of a holding — for example, if you bought 100 shares at different times and sold 50 of them. You might use "first in, first out" (FIFO), which assumes you sold the oldest shares first, or "specific identification," which lets you choose which shares you sold. The method you choose affects your gain or loss, so it is worth understanding the options.

Multiple 1099-B forms and how to organize them

If you have brokerage accounts at more than one firm, each broker sends you a separate 1099-B. If you have a regular taxable brokerage account and a separate margin account at the same broker, you may receive two forms. You need to gather all of them before you file your taxes and combine the information on a single Schedule D.

Create a straightforward spreadsheet or list that pulls together all the sales from all your 1099-B forms in one place. This makes it easier to spot errors, verify that cost basis information is complete, and calculate your total gains and losses. It also makes it easier to explain your numbers to a tax professional if you need help.

Keep your 1099-B forms and your supporting documents (like trade confirmations and purchase receipts) for at least three years after you file your return. The IRS can audit returns going back several years, and you will need these documents to prove your numbers if questions come up.

Frequently Asked Questions

Do I need to report every sale on my tax return if I received a 1099-B?

Yes. Every sale that appears on a 1099-B should be reported on Schedule D. The IRS receives a copy of the form, so they expect to see those transactions on your return. Even if you had a loss on a particular sale, you still report it because losses can reduce your overall tax liability.

What if my 1099-B shows the wrong cost basis?

You can correct it on your tax return. The 1099-B is the broker's record of what they sold and for how much, but the cost basis section is often incomplete or inaccurate, especially for older investments or transfers. Use your own records to calculate the correct cost basis and report the correct gain or loss on Schedule D, even if it differs from what the 1099-B shows.

Do I report sales from my retirement account on a 1099-B?

No. Sales within a 401(k), IRA, or other retirement account do not generate a 1099-B because those accounts are tax-deferred. You only report income from retirement accounts when you withdraw money, which appears on a 1099-R form instead.

What if I sold an investment at a loss — do I still need the 1099-B?

Yes. Losses are just as important to report as gains because they reduce your taxable income. You need the 1099-B to document the sale, and you report the loss on Schedule D so you can use it to offset gains or reduce other income.

Can I file my taxes without receiving a 1099-B if I know what I sold?

You can file, but it is risky. The IRS received a copy of the 1099-B from your broker, so they have a record of the sale. If your reported numbers do not match, the IRS may send you a notice. It is safer to wait for the form or contact your broker to request it if it is late.