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Topic: Cost basis on 1099 wrong
Hi, Laurie.

I know that the cost basis from last year is not being
reported to the IRS but ours has a large discrepancy when
compared to our bivio cost basis report, all related to a
sale of a stock (AIB) that dropped off the screen due to the
mess with the Irish banks.

Do we need to worry about this or can we go ahead with what
bivio, which we believe is using the correct cost basis, has
computed?

Thanks for your help.

Ann
Money Mavens of Fremont
Hi Ann,

If you have correctly recorded all purchase, sale and reorganization information in bivio and have not had any wash sales,  bivio will calculate correct cost basis for your investments.

If you are unsure of this,  send us the 1099 information you are looking at  to us at support@bivio.com and identify where you see differences and we can help you try and work through the reasons for them.

As you have noted,  brokers do not have to report cost basis for 2011 for anything other than stocks you have purchased and sold in 2011.  They may give you other information but it in general it seems they are only giving it to you for your information and are not also sending it to the IRS.  There are a variety of reasons their numbers may be wrong,  but it  is often a good idea to at least know why they are different.

For example,  in many of the more complicated reorganizations,  we have found where the information they provide is just wrong.  In addition,  if you see where they are noting wash sale adjustments, either for 2011 or earlier years,  and you haven't closed out a position entirely, you will need to contact us to make sure that the proper adjustments are made in bivio for the correct reporting of capital gains/losses.



Laurie Frederiksen
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www.bivio.com

Become our Facebook friend!  www.facebook.com/bivio
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On Sat, Mar 3, 2012 at 10:58 AM, Ann Dexheimer  wrote:
Hi, Laurie.

I know that the cost basis from last year is not being
reported to the IRS but ours has a large discrepancy when
compared to our bivio cost basis report, all related to a
sale of a stock (AIB) that dropped off the screen due to the
mess with the Irish banks.

Do we need to worry about this or can we go ahead with what
bivio, which we believe is using the correct cost basis, has
computed?

Thanks for your help.

Ann
Money Mavens of Fremont

I'm running an audit of my club, and I've run into an issue that I knew would come up, but I do not know how to fix:

-In January of 2011, two of our members withdrew. There was a bit of social tension around this withdrawal, and--long story short--when we paid out their portion we neglected to deduct a member withdrawal fee
-This fee totaled $28.56 for both members
-Recently, one of these members gave me $28.56 in cash
-Now that I have this cash, I would like to deposit it into our account, but, given that 2011 is already closed, I don't know how to do this, how to record it, or how to fix it.


Can anyone help?

Thank you!

Ellen

End Game Investments






Dear Ellen,

Have you filed your 2011 tax returns yet?

This is one of those things that is more complicated to account for than it would have been to just chalk up the mistake to being a learning experience and just let it go.

Basically you overpaid them for their withdrawal which, if you have already given out tax information,  means there were already small tax implications to everyone for that.

To truly correct it,  you'd need to amend whatever you've already done, refile your taxes and redistribute K-1's to all your members.

If, however,  everyone involved is willing to just leave things as they are,   you could just divide up the $28.56 between the remaining members and enter each persons portion as a member payment.  You could even return it to the members who left and just let the whole thing go.

Maybe others have some other ideas.  Those are just a couple that come to my mind.

If you haven't filed taxes yet,  email us at support@bivio.com and we'll help you make some entries that will let you track the cash flow as well as get all the tax reporting done correctly for everyone.

Laurie Frederiksen
Invest with your friends!
www.bivio.com

Become our Facebook friend!  www.facebook.com/bivio
Follow us on twitter!  www.twitter.com/bivio


Click here to
Subscribe to the Club Cafe email list.  Click here to  Unsubscribe



On Mon, Mar 12, 2012 at 5:24 PM, Ellen Shershow wrote:
I'm running an audit of my club, and I've run into an issue that I knew would come up, but I do not know how to fix:

-In January of 2011, two of our members withdrew. There was a bit of social tension around this withdrawal, and--long story short--when we paid out their portion we neglected to deduct a member withdrawal fee
-This fee totaled $28.56 for both members
-Recently, one of these members gave me $28.56 in cash
-Now that I have this cash, I would like to deposit it into our account, but, given that 2011 is already closed, I don't know how to do this, how to record it, or how to fix it.


Can anyone help?

Thank you!

Ellen

End Game Investments


Ellen Shershow Peņa Photography