How to Report Your Stock Investment Activity to the IRS
Most stock investors report their investment-related activities on their individual tax returns (Form 1040). The reports that you’ll likely receive from brokers and other investment sources include the following:
Brokerage and bank statements: Monthly statements that you receive
Trade confirmations: Documents to confirm that you bought or sold stock
1099-DIV: Reporting dividends paid to you
1099-INT: Reporting interest paid to you
1099-B: Reporting gross proceeds submitted to you from the sale of investments, such as stocks and mutual funds
You may receive other, more obscure forms that aren’t listed here. You should retain all documents related to your stock investments.
The IRS schedules and forms that most stock investors need to be aware of and/or attach to their Form 1040 include the following:
Schedule B: To report interest and dividends
Schedule D: To report capital gains and losses
Form 4952: Investment Interest Expense Deduction
Publication 17: Guide to Form 1040
You can get these publications directly from the IRS at 800-829-3676, or you can download them from the website. For more information on what records and documentation investors should hang on to, check out IRS Publication 552, Recordkeeping for Individuals.
If you plan to do your own taxes, consider using the latest tax software products, which are inexpensive and easy to use. These programs usually have a question-and-answer feature to help you do your taxes step by step, and they include all the necessary forms. Consider either TurboTax or H&R Block At Home. Alternatively, you can get free tax preparation software at TaxACT.