Release me from Schedule D!

March 11, 2010 3:31 PM

CapitalGainsFilter: I got less than $20 from my mutual fund distributions, my only capital gain this year. Must I fill out Schedule D on my (US Federal Income Tax) 1040? Schedule D gives me a migraine, I'd rather stay away if possible.

I have a feeling they won't complain as long as I state the Gains on the 1040, even though my 1099 has even less amounts on its lines 2B and 2C.

No I don't use any tax software, as I couldn't itemize last year.

posted by Rash to work & money (6 answers total)

The IRS tells you when it's okay to skip a form because it's under a certain $ amount. I don't see any minimum like that on the Schedule D instructions, though it may just be listed somewhere else. Having a 1099 without a corresponding Schedule D is not doing you any favors in avoiding an audit - I wouldn't take the chance.
posted by 0xFCAF at 3:49 PM on March 11, 2010

Perhaps bite the bullet and spend $20 on TaxAct?

It might be worth it. . .makes all of the supplemental forms easy.
posted by Danf at 4:01 PM on March 11, 2010

Odds are, they will not complain regardless. Very few people are audited.

If it were me, I would just ballpark the amount of extra tax I owed, and pay it. maybe $5.50 in your case? Worst, case, you get audited and they figure out exactly how much you really owe. Then you may pay a penalty, which is a percentage of what you owe them. So if it turns out you owe them a dollar, the penalty will spike that up to probably $1.25. I don't think the risk of potentially owing an extra quarter is worth the aggravation of figuring out the schedule D. So I wouldn't.

IANAL. IANAA. YMMV.
posted by contrarian at 6:50 PM on March 11, 2010

What kind of 1099 did you get?
posted by smackfu at 7:51 AM on March 13, 2010

The E*Trade kind, that isn't specific, many pages with all kinds of unnecessary info, and if history is my guide, a revision will hit my mailbox moments after I mail in my completed 1040.
posted by Rash at 3:35 PM on March 13, 2010

I ask because if it was a 1099-B because you sold stocks or funds, the IRS has no idea how much you paid for it and will assume you got it for free.
posted by smackfu at 3:47 PM on March 13, 2010