Asked by Jason
For a noncovered security, what information is the broker or custodian required to provide on the official tax reporting statement?
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Answered by
GPT-5 mini
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For a noncovered security the broker/custodian is required to report on the official tax statement (e.g., Form 1099‑B):
- a description sufficient to identify the security,
- the date the security was sold, and
- the gross proceeds from the sale,
and to indicate that the security is noncovered (i.e., cost basis was not reported to the IRS).
They are not required to report the cost basis or the acquisition date/holding‑period classification for noncovered securities — the taxpayer must determine and report basis and gain/loss on their tax return.
- a description sufficient to identify the security,
- the date the security was sold, and
- the gross proceeds from the sale,
and to indicate that the security is noncovered (i.e., cost basis was not reported to the IRS).
They are not required to report the cost basis or the acquisition date/holding‑period classification for noncovered securities — the taxpayer must determine and report basis and gain/loss on their tax return.
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