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Form 1099-B Instructions 2026: Reporting Gains & Losses

Form 1099-B is an IRS information return that brokers use to report proceeds from certain sales and other reportable securities transactions, and that barter exchanges use to report exchanges of property or services through a barter exchange. This guide on broker barter exchange reporting will walk you through 1099-B instructions (2026), the deadlines, and details on cost basis reporting.

What Is Form 1099-B and Why Does It Matter?

Form 1099-B is an IRS form that brokers use to report the proceeds a customer received from selling or trading investments. This includes shares, bonds, mutual funds, options, futures, commodities, and foreign currency contracts. It is also used for transactions carried out through organized barter exchanges.

Key information reported includes:

  • gross proceeds
  • barter exchange transactions (barter proceeds)
  • profit or loss on closed contracts
  • unrealized profit or (loss) on open contracts
  • aggregate profit or (loss) on contracts
  • cost or other basis for covered securities (when required)
  • type of gain or loss (short-term, long-term, or ordinary)
  • wash-sale adjustments

1099-B digital asset rule

Digital asset sales effected in 2025 are generally reported on Form 1099-DA, not Form 1099-B.

Why accuracy matters

Accuracy in 1099-B filing is essential because the IRS compares the Form 1099-B amounts to what the recipient reports on their tax return (often on Form 8949/Schedule D). Mismatches can trigger a CP2000 notice, which can result in additional tax, penalties, and interest.

Late, missing, or inaccurate Form 1099-B filings can trigger penalties ranging from $60 to $340 per return, depending on how late the correct return is filed. If the failure to file correctly is considered to be due to intentional disregard, the penalty is at least $680 per return, and there’s no maximum penalty for intentional disregard. Backup withholding remains 24% when required.

Who Must File 1099-B & Key Deadlines 2026

A broker or a barter exchange must file Form 1099-B for each person who:

  • had certain property sold for them (including short sales),
  • received cash, stock, or other property because of certain corporate actions, or
  • traded goods or services through a barter exchange.

Brokers

Brokers can be clearing organizations, banks, online trading platforms, and other institutions that execute or process trades on behalf of clients. Brokers may provide a consolidated statement that includes Form 1099-B, but they must ensure each component remains clearly labeled.

There’s generally no minimum dollar threshold for most reportable broker transactions, but the Form 1099-B instructions list specific exceptions (for example, sales of fractional shares of stock if gross proceeds amount to less than $20).

Barter Exchanges

If an organization is a barter exchange, it generally must file Form 1099-B to report the gross amount each member or client received. This includes:

  • cash,
  • the FMV of property or services received,
  • and the FMV of any trade credits or scrip credited to the account.

(FMV is the Fair Market Value)

A barter exchange doesn’t have to file Form 1099-B for:

  • exchanges with fewer than 100 transactions during the year
  • exempt foreign persons, or
  • exchanges where the FMV is less than $1.00.

The person who receives goods or services through bartering generally must include the FMV in income.

Important 2026 Filing Dates

Filing requirement Due date Notes
Furnish Copy B / recipient statement February 17, 2026 This is the special recipient deadline for Form 1099-B (also applies if you furnish it as part of a consolidated statement).
Paper-file Copy A with IRS (with Form 1096) March 2, 2026 The paper deadline is March 2 for 2025 returns. Paper filing is generally only allowed if you’re not required to e-file (or you have an approved waiver).
E-file Copy A with IRS March 31, 2026 You generally must e-file if you file 10+ information returns in aggregate (W-2, 1099s, etc.) for the calendar year.

Form 1099-B: Box-by-Box Walk-Through

Box What the payer reports Tips for accurate reporting
1a Description of property Use a clear description (issuer and shares/units). Include the CUSIP if available (there’s a separate CUSIP box).
1b / 1c Date acquired / date sold or disposed of These dates support the short-term vs long-term classification selected in Box 2.
1d Proceeds Report gross cash proceeds reduced by commissions and transfer taxes. Do not include accrued bond interest—report that on Form 1099-INT.
1e Cost or other basis Required for covered securities. If Box 5 is checked, Box 1e may be left blank (but can be completed optionally).
1f Accrued market discount Enter accrued market discount if applicable. May be left blank if Box 5 is checked.
1g Wash sale loss disallowed Report the disallowed wash-sale loss separately; do not net it against proceeds. Leave blank if Box 5 is checked.
2 Short-term / Long-term / Ordinary Check the correct category. “Ordinary” may trigger special tax treatment and should be reviewed carefully.
3 Collectibles or QOF proceeds Check only when proceeds in Box 1d relate to collectibles or Qualified Opportunity Funds.
4 Federal income tax withheld Report backup withholding when required (generally 24%).
5 Noncovered security checkbox Check only for noncovered securities. When checked, certain boxes (1b, 1e, 1f, 1g, 2) may be left blank.
6 Gross proceeds / Net proceeds indicator Indicates gross vs net proceeds reporting (relevant for certain option-premium situations).
7 Loss not allowed (change in control) Used for reportable change-in-control/capital-structure events—not general related-party loss rules.
8–11 Section 1256 / regulated futures / foreign currency Used for aggregate reporting of contracts, including profit/loss and year-end adjustments.
12 Basis reported to IRS checkbox Check when basis in Box 1e is reported to the IRS (generally when Box 5 isn’t checked).
13 Bartering Include cash, FMV of property/services, and trade credits or scrip.
14–16 State and local details Complete only if reporting state or local withholding and payer/state IDs.

Cost Basis & Covered-Security Rules

Getting 1099-B cost basis reporting right is what keeps gains/losses accurate. Under IRS rules, brokers must report basis (and related details) for covered securities on Form 1099-B.

Covered securities:

Covered securities generally include:

  • Stock bought for cash after 2010 (except average-basis stock)
  • Average-basis stock bought for cash after 2011
  • Certain debt instruments, options, and securities futures contracts entered into after 2013 (with additional specified debt/options after 2015)
  • Any specified security transferred in with a transfer statement showing it’s covered

FIFO vs. Specific ID:

If the customer doesn’t give the broker an adequate and timely lot ID, report the sale first for any shares with an unknown purchase date, then use FIFO for the rest. If they properly identify specific shares with the broker, you can use Specific ID.

Basis-related reporting adjustments (as applicable):

  • Wash-sale disallowed loss (Box 1g)
  • Accrued market discount (Box 1f)
  • Premium amortization (when it applies to the instrument)

Section 1256 contracts:

These are handled in the contract reporting boxes on Form 1099-B (aggregate profit/loss), not as a general “basis adjustment”.

Digital assets:

For dual classification assets (digital assets that are also securities), you generally report the sale on Form 1099-DA (not 1099-B)—with a few specific exceptions (including certain Section 1256 contract reporting on 1099-B).

Noncovered securities:

If it’s noncovered, you may check Box 5 and (if you’re not reporting basis) leave Box 1e blank. When Box 5 is checked, you can also leave Boxes 1b, 1f, 1g, and 2 blank.

How to file Form 1099-B?

Step 1: Collect Forms W-9 (and W-8 where applicable) and validate name/TINs using IRS TIN Matching.

Step 2: Track lot-level sales/dispositions, including basis details and reportable adjustments.

Step 3: Reconcile year-end totals by account and CUSIP/lot (proceeds, basis where covered, wash-sale/discount items, and any withholding).

Step 4: Furnish borrower copies and also e-file with the IRS (Tax1099 allows both on the platform) by the 1099-B e-file deadline. Save acceptance/error reports.

Step 5: Handle state reporting next—use the Combined Federal/State Filing (CF/SF) program where available, and file directly with states when required (especially if state tax was withheld).

Step 6: Keep status/acknowledgment records and the underlying files (or be able to reconstruct them) for at least 3 years from the reporting due date—4 years if backup withholding was imposed.

Common Errors & Quick Fixes

Error Type Why It Happens Corrective Action
Missing acquisition date Missing transfer statement or legacy lots Covered security: pull the acquisition date from the transfer statement or lot history and file a CORRECTED 1099-B. Noncovered (Box 5 checked): Box 1b may be left blank.
Basis reported for noncovered shares Mapping or import error If the shares are truly noncovered, check Box 5 and remove basis (leave Box 1e blank), then issue a CORRECTED 1099-B.
Wrong term classification Lot mixing, corporate actions, option exercise or assignment Correct Box 2 (short-term, long-term, or ordinary). If lots are mixed, split into separate 1099-Bs and reissue as CORRECTED.
Backup withholding omitted Missing or incorrect TIN; mismatch not acted on Begin 24% backup withholding immediately and report it in Box 4 going forward. Correct prior 1099-B only if withholding was taken but reported incorrectly.
Digital asset filed on wrong form Dual-classification confusion For 2025 digital asset sales, file Form 1099-DA in most cases. Void or correct the incorrect 1099-B and file the correct form unless a specific exception applies.

Real-Life Scenarios

Transaction Outcome Correct Form / Key Boxes
Sale of 250 XYZ shares (bought 4/2/2021, sold 6/1/2025) Long-term covered sale Form 1099-B: Boxes 1a, 1b, 1c, 1d, 1e; Box 2 = Long-term; check Box 12 if basis is reported to the IRS.
Day trade: Buy & sell ABC on 8/10/2025 Short-term, same-day trade Form 1099-B: Boxes 1a–1e; Box 2 = Short-term.
Option assignment — writer delivers shares Stock sale triggered by assignment Form 1099-B: Report stock disposition in Boxes 1a–1e and Box 2. Box 1d should reflect disposition proceeds—avoid double-counting option premium.
Barter exchange: Design services swapped for laptop ($1,200 FMV) Barter income reportable Form 1099-B (barter): Describe the exchange in Box 1a, enter the transaction date in Box 1c, and report $1,200 FMV in Box 13.
Tokenized security sale (dual-classification digital asset) in 2025 Usually not reported on 1099-B Generally file Form 1099-DA, not Form 1099-B, for tokenized or dual-classification digital assets.

Frequently Asked Questions

1. Is there a dollar threshold for Form 1099-B?

Usually, there’s no minimum dollar amount for reportable broker sales—but some sales aren’t reportable (for example, sales of fractional shares if gross proceeds are under $20), so check the Form 1099-B “Exceptions” list.

2. What if prior brokers didn’t send the basis?

If you don’t get a required transfer statement by the due date, you must request it. If you still don’t get a complete one, you may treat the security as noncovered—but if you later get a transfer statement showing it’s covered, you must file a corrected Form 1099-B within 30 days. For noncovered securities, you generally don’t have to report basis (you may check Box 5 and leave the basis boxes blank).

3. Are corporations exempt?

Usually, yes—corporations are exempt recipients for most broker sales. But you still must file Form 1099-B for the sale of a covered security by an S corporation that acquired it after 2011, and all dispositions of QOF interests (even if the seller is a corporation). Barter exchanges still report barter trades; corporate members may be reported in the aggregate.

4. How are wash-sale losses reported?

The disallowed loss is listed separately in Box 1g. The sale proceeds are not changed.

5. Can statements be delivered electronically?

Yes, but only if the recipient has agreed to electronic delivery.

The Bottom Line

Form 1099-B is easier to get right when basis, holding period, and withholding are validated before you transmit. Clean data means fewer corrections, fewer notices, and faster year-end reporting.

Import your transaction file, run TIN and basis checks, and e-file Form 1099-B (and state copies where required) with Tax1099 in minutes.

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