What a 1099-B Form Is and Why Your Broker Sends It

A 1099-B reports the sales you made through your brokerage account

A 1099-B is a tax form your broker sends you each year if you sold stocks, bonds, mutual funds, or other securities through your account. It lists every sale you made, the date you sold it, how much you received, and your cost basis — what you originally paid for it. The IRS gets a copy too, so the numbers on your 1099-B should match what you report on your tax return.

You will receive a 1099-B if you had any sales activity during the tax year, even if you only sold one thing. If you held investments but did not sell anything, you will not get a 1099-B (though you may get other forms if the investments paid dividends or interest).

The form arrives by January 31 of the year after the sales occurred. For example, sales you made in 2024 appear on a 1099-B you receive in January 2025.

Key Takeaways

• A 1099-B lists every security you sold through your brokerage account, including the sale price and your original cost.
• Your broker reports this information to the IRS, so you must report the same sales on your tax return or face a mismatch notice.
• The form shows your proceeds (what you received) but not automatically your gain or loss — you calculate that by subtracting cost basis from proceeds.
• You need your 1099-B to complete Schedule D, the tax form where you report capital gains and losses.

Where the 1099-B comes from and who needs one

Your brokerage firm — whether that is Fidelity, Charles Schwab, E-Trade, Vanguard, or another broker — generates the 1099-B and mails it to you. The broker has a legal obligation to send it to you and file a copy with the IRS.

You need a 1099-B if you sold securities through a brokerage account at any point during the tax year. This includes stocks, ETFs, mutual funds, bonds, options, and cryptocurrency if you sold it through a broker that reports to the IRS. If you sold something outside a brokerage account — for example, you sold a car or jewelry privately — that does not appear on a 1099-B.

If you have multiple brokerage accounts, you may receive multiple 1099-B forms, one from each broker. Some brokers combine all your accounts into a single form.

What information appears on the form

A 1099-B contains several key pieces of information for each sale:

• The description of what you sold (the security name and ticker symbol)
• The date you sold it
• The number of shares or units you sold
• Your proceeds — the total amount you received from the sale
• Your cost basis — what you paid for the security originally
• Whether the gain or loss is long-term or short-term (based on how long you held it)

The form also includes your name, Social Security number, and the broker's name and tax ID. Box 1a shows your total proceeds, and Box 1b shows your total cost basis. Boxes 1d and 1e break down whether your gains are long-term (held more than one year) or short-term (held one year or less).

Not all 1099-B forms look identical. The IRS updates the form layout periodically, and different brokers may arrange the information slightly differently. However, the core data — proceeds, cost basis, and holding period — appears on every form.

How proceeds and cost basis work on the form

Your proceeds is the amount of money you received when you sold the security. If you sold 100 shares at $50 per share, your proceeds are $5,000 (before any broker fees or commissions). This is not your profit — it is straightforward what you got paid.

Your cost basis is what you originally paid for the security. If you bought those 100 shares at $40 per share, your cost basis is $4,000. Your gain is the difference: $5,000 minus $4,000 equals $1,000 in profit.

The 1099-B shows both numbers separately. Your job when you file taxes is to subtract the cost basis from the proceeds to find your actual gain or loss. If your proceeds are less than your cost basis, you have a loss, which you can use to offset other gains or, in some cases, reduce your ordinary income.

Some brokers calculate cost basis automatically and show it on the form. Others, especially for older accounts or securities bought before certain dates, may show cost basis as "unknown" or leave it blank. If cost basis is missing, you will need to find your original purchase records or contact the broker to request it.

The difference between long-term and short-term holdings

The 1099-B separates your sales into two categories based on how long you held each security. This matters for taxes because long-term and short-term capital gains are taxed differently.

Long-term capital gains come from securities you held for more than one year. These are taxed at preferential rates, which are usually lower than ordinary income tax rates. The exact rate depends on your income level and tax bracket.

Short-term capital gains come from securities you held for one year or less. These are taxed as ordinary income at your regular tax rate, which is typically higher than the long-term rate.

Your 1099-B shows which sales fall into each category. The broker calculates the holding period based on the purchase date and sale date. When you file your taxes, you will report long-term and short-term gains separately on Schedule D, and the IRS will explore the correct tax rate to each.

How to use your 1099-B when filing taxes

You will report the information from your 1099-B on Schedule D (Form 1040), which is the IRS form for reporting capital gains and losses. You list each sale from your 1099-B on Schedule D, organized by long-term and short-term transactions.

If you have only a few sales, you can enter them directly on Schedule D. If you have many sales, you may use Form 8949 (Sales of Capital Assets) to list them all, then transfer the totals to Schedule D. Your tax software will usually handle this automatically if you enter your 1099-B information.

The IRS receives a copy of your 1099-B at the same time you do. If the numbers you report on your tax return do not match the 1099-B the IRS has on file, you may receive a notice asking you to explain the difference. This is why it is important to report all your sales accurately.

Keep your 1099-B with your tax records for at least three years. The IRS can audit your return for up to three years after you file (or longer if there is a substantial underreporting of income).

What to do if your 1099-B has an error

If you notice a mistake on your 1099-B — for example, the wrong sale date, incorrect proceeds, or a missing cost basis — contact your broker when ready. Ask them to issue a corrected form, called an amended 1099-B. The broker will send you a corrected copy and file a corrected copy with the IRS.

Do not file your tax return until you have the corrected form. If you file before the correction is issued and the IRS later receives a different 1099-B, you may face a mismatch notice.

If the broker refuses to correct an error or you believe the error is on your side (for example, you used the wrong cost basis), you can still file your tax return with the correct information. Include a note explaining the discrepancy. You may also need to file Form 8949 to reconcile the difference between what the 1099-B shows and what you are actually reporting.

Frequently Asked Questions

Do I need to report sales if I had a loss?

Yes. You must report all sales on Schedule D, whether they resulted in gains or losses. Losses are valuable because you can use them to offset gains from other sales, and in some cases reduce your ordinary income by up to $3,000 per year. Unused losses carry forward to future years.

What if I sold securities through multiple brokers?

You will receive a separate 1099-B from each broker. Enter all of them on your Schedule D. The IRS will receive copies from each broker too, so make sure your tax return accounts for all of them.

Can I use my 1099-B to calculate my cost basis if the broker did not provide it?

The 1099-B shows what the broker has on file, but it may not be complete, especially for older purchases or inherited securities. You will need to find your original purchase confirmations or contact the broker to request a cost basis report. Your tax software may also help you research missing cost basis information.

What happens if I do not report a sale that appears on my 1099-B?

The IRS will likely send you a notice because the 1099-B they received does not match your return. You will need to file an amended return and may owe additional tax, interest, and penalties. It is easier to report the sale correctly the first time.

Is a 1099-B the same as a 1099-DIV or 1099-INT?

No. A 1099-B reports sales of securities. A 1099-DIV reports dividend income, and a 1099-INT reports interest income. You may receive all three forms in the same year if your brokerage account had sales, dividends, and interest-bearing investments.