How do I report stock sales on Form 8949 and Schedule D in 2025?

When you sell stocks, bonds, mutual funds, or other securities, you must report each transaction on Form 8949 and summarize the results on Schedule D.

Step-by-step process:

• Gather your Form 1099-B from your broker(s). This shows each sale with proceeds, date sold, date acquired, and cost basis.
• Separate transactions into short-term (held 1 year or less, Part I of Form 8949) and long-term (held more than 1 year, Part II).
• For each transaction, report: description, date acquired, date sold, proceeds, cost basis, and gain or loss.
• Use the correct Box code (A, B, C for short-term; D, E, F for long-term) depending on whether basis was reported to the IRS by your broker.
• Transfer totals to Schedule D, which calculates your net capital gain or loss.

Cost basis methods: When selling partial positions, you can use specific identification (choose which shares to sell), FIFO (first in, first out), or average cost (mutual funds and ETFs only). Specific identification gives you the most control over your tax outcome. Tell your broker which lots to sell BEFORE the trade settles.

Adjustments column (Column g): If your 1099-B shows incorrect basis (common with RSUs, options, and wash sales), enter adjustment codes and amounts in columns (f) and (g) of Form 8949. Common codes: B (basis incorrect), W (wash sale loss disallowed).

Net capital loss: If losses exceed gains, you can deduct up to $3,000 ($1,500 MFS) against ordinary income. Remaining losses carry forward to future years indefinitely. Track your capital loss carryforward carefully as the IRS does not track it for you.