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Page 2 of 12 Fileid: … ons/i1099b/2023/a/xml/cycle04/source 11:53 - 26-Sep-2022
The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.
by others. A broker may include a U.S. or foreign person Additional information required for covered securi-
or a governmental unit and any subsidiary agency. ties. For each sale of a covered security for which you
are required to file Form 1099-B, report the date of
You are considered a broker if:
acquisition (box 1b); whether the gain or loss is short-term
• You are an obligor that regularly issues and retires its
or long-term, and whether any portion of the gain or loss is
own debt obligations, or
ordinary (box 2); cost or other basis (box 1e); the amount
• You are a corporation that regularly redeems its own
of accrued market discount (box 1f); and the loss
stock.
disallowed due to a wash sale (box 1g). When selling a
However, for a sale, redemption, or retirement at an office
noncovered security and reporting it on a separate Form
outside the United States, only a U.S. payer or U.S.
1099-B, you may check box 5 and leave boxes 1b, 1e, 1f,
middleman is a broker. See Regulations sections
1g, and 2 blank. If you check box 5, you may choose to
1.6045-1(g)(1) and 1.6049-5(c)(5).
report the information requested in boxes 1b, 1e, 1f, 1g,
You are not considered a broker if: and 2 and will not be subject to penalties under section
• You are a corporation that purchases odd-lot shares 6721 or 6722 for failure to report this information correctly.
from its stockholders on an irregular basis (unless facts Example. Your customer Bella bought shares of stock
indicate otherwise), in ABC Corporation in April 2001, April 2022, and August
• You manage a farm for someone else, or 2022. The shares of stock bought in 2022 are covered
• You are an international organization that redeems or securities. The shares of stock bought in April 2001 are
retires its own debt. See Regulations section 1.6045-1(a) noncovered securities. In June 2023, Bella sells all of the
(1). stock in a single transaction. Even though the stock was
sold in a single transaction, you must report the sale of the
Reporting covered securities on two separate 2023 Forms 1099-B
How many transactions to report on each form. (one for the securities bought in April 2022 with long-term
Report each transaction (other than regulated futures, gain or loss and one for the securities bought in August
foreign currency, or Section 1256 option contracts) on a 2022 with short-term gain or loss). You must report the
separate Form 1099-B. Report transactions involving sale of the noncovered securities on a third Form 1099-B
regulated futures, foreign currency, or Section 1256 or on the Form 1099-B reporting the sale of the covered
option contracts on an aggregate basis. However, you securities bought in April 2022 (reporting long-term gain or
may report these contracts on an aggregate basis on a loss). You may check box 5 if reporting the noncovered
separate Form 1099-B for each type of contract. securities on a third Form 1099-B. If you check box 5, you
may leave boxes 1b, 1e, and 2 blank or you may complete
How many forms to file for each transaction. Report boxes 1b, 1e, and 2 and not be subject to penalties under
sales of each of the following types of securities on a section 6721 or 6722 for failing to report this information
separate Form 1099-B, even if all three types were sold in correctly.
a single transaction.
• Covered securities (defined later) with short-term gain Short sales of securities. Do not report a short sale
or loss. entered into after 2010 until the year a customer delivers a
• Covered securities with long-term gain or loss. security to satisfy the short sale obligation, unless there is
• Noncovered securities (securities that are not covered backup withholding. See Backup withholding, later.
securities) if you choose to check box 5 when reporting Disregard sections 1259 (constructive sales) and 1233(h)
their sale. (short sales of property that becomes worthless). Report
the short sale on a single Form 1099-B unless:
Closing transactions. In the case of an option, a • You are reporting both short-term and long-term gain or
regulated futures contract, a securities futures contract, or loss from a short sale closed by delivery of covered
a forward contract, a sale includes any closing securities (as explained earlier under How many forms to
transaction. A closing transaction is a lapse, expiration, file for each transaction),
settlement, abandonment, or other termination of a • The securities delivered to close the short sale include
position (which includes a right or an obligation under a both covered securities and noncovered securities (as
forward contract, a regulated futures contract, a securities explained earlier under How many forms to file for each
futures contract, or an option). transaction), or
Example. An option that is a covered security, that • There was backup withholding and other conditions
also has a basis of zero in the option upon a closing apply (see Backup withholding, later).
transaction, enter -0- in box 1e. Report on Form 1099-B the relevant information about the
security sold to open the short sale, with the exceptions
Substitute statements. Brokers that use substitute
described in the following paragraphs.
statements may be able to report customer transactions
(stock sales (Form 1099-B), interest earned (Forms In box 1a, report the quantity of the security delivered to
1099-INT and 1099-OID), dividends (Form 1099-DIV), close the short sale.
and foreign taxes paid (Forms 1099-DIV and 1099-INT)) In box 1b, report the acquisition date of the security
for the year on a single substitute statement. For details, delivered to close the short sale.
see Pub. 1179, General Rules and Specifications for In box 1c, report the date the security was delivered to
Substitute Forms 1096, 1098, 1099, 5498, and Certain close the short sale.
Other Information Returns, at IRS.gov/Pub1179, which
provides the rules for substitute forms.
-2- Instructions for Form 1099-B (2023)
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