Changes in 1099s

There are two major changes to 1099 information reporting this year.

1099-B Broker reporting

Investment companies are now required to report the cost of investments you sold during the year to the IRS. This “basis” will be used by the government to audit your reported gain or loss on the sale of these investments.

New 1099-Ks

If you used PayPal or similar credit card processing service for Ebay or other similar transactions you may receive a 1099-K that recaps these transactions. This form is also being sent to the IRS to try to report previously underreported small business activity.

If you receive either of these forms it is important to make sure the amounts reported on them are correct. Any errors should either be corrected on your tax return or be brought to the attention of the supplier for re-issuance.