Irs Tax Form Schedule D is used for calculating your capital gains and losses throughout the year. Capital gains and losses are based off your asset sales, a common example is the sale of stock of a publicly held company. When you sell this stock you need to calculate how much gain or loss you incurred.
To first calculate a gain or loss in a stock, you need to know what your basis is. The basis of a stock is the price you paid to acquire it. When you sell the stock, you subtract the selling price from the basis to determine if you created a gain or loss for tax purposes. Schedule D is there to help you catalog and record all the stock transactions that you made throughout the year.
Schedule D is also not just for stocks, it’s for the sale of land and other physical assets, these can all trigger gains or losses for your tax return. One of the big things you need to know when filling out this form is the classification of a capital gain as short term or long term. Short term is defined by the IRS as less than one year. So for example if you bought a stock in January, 2008 and sold it in June, 2008 you would have a short term capital gain or loss and would have to record it in the appropriate column.
Download form 1040 Schedule D right now directly from the IRS Website!
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