PeterAndrew
Junior Member
What is the name of your state? California
I received a 1099-B which includes several items listed as "Return of Principal" as well as several items which refer to a full call on various municipal bonds. I realize that if my basis is reduced by return of principal, I will have to report a larger gain (or lesser loss) if I sell. But I didn't actually sell any of these securities. I am just concerned that if I omit these items from my Schedule D, the IRS may believe I am not reporting capital gains accurately. Does the IRS look at the 1099-B's and note that return of principal and calls on bonds don't equate to capital gains? Or should I list the returns of principal and bond calls and then zero them out by claiming the same as my basis? Or attach a note to my return?
I received a 1099-B which includes several items listed as "Return of Principal" as well as several items which refer to a full call on various municipal bonds. I realize that if my basis is reduced by return of principal, I will have to report a larger gain (or lesser loss) if I sell. But I didn't actually sell any of these securities. I am just concerned that if I omit these items from my Schedule D, the IRS may believe I am not reporting capital gains accurately. Does the IRS look at the 1099-B's and note that return of principal and calls on bonds don't equate to capital gains? Or should I list the returns of principal and bond calls and then zero them out by claiming the same as my basis? Or attach a note to my return?