Am I Required To List All Trades ?
Depends.
Prior to tax year 2013, you were required to list all sales transactions on your tax return. The IRS
compared your tax return to the list of broker reported sales transactions on form 1099, and expected
them to match.
However, beginning in tax year 2013, certain sales transactions can be summed and reported directly
on Schedule D, instead of listing the details on Form 8949.
Sales transactions that can be summed:
- must have had associated cost basis reported to the IRS
- must not have any adjustments to the basis or sale
- must not be a non-deductible wash sale transaction
Any sales transactions which do not satisfy all 3 of the conditions must be reported on Form 8949 individually.
Even if you can aggregate some or all of your sales transactions, you don't have to. If you prefer, you can still
report all sales transactions individually. If you use software to prepare your Form 8949, it may be easier
to continue reporting all sales transactions.
When reporting summed sales transactions directly on Schedule D, be sure that your totals match the 1099 data
for both the sales and the cost basis, otherwise the IRS may become "interested" in your tax return.
An advantage to reporting all sales transactions is that discrepancies are easier to explain and resolve with
all the details readily available.
For more information, please refer to the
official IRS instructions.