What’s New for the 2009 Gain/Loss Summary Worksheet
Wash Sales – If you sold a stock or security at a loss, but re-purchased within 30 days the same or substantially the same security, the Worksheet identifies the sale using code “WS” (Disallowed loss from wash sale).
Social Security Number – For security purposes, the first 5 digits of the tax identification number have been removed.
Tax Basis Declaration – Two new tax basis methods, made available January 2009, help identify gain/loss methods for trades. The optional methods Last In, First Out (LIFO) and Maximize Losses (ML) join the default First In, First Out (FIFO) on the Worksheet.
Select Gain/Loss Summary Worksheet: Considerations for details about the new features.
Click here to go back to the main 2009 Worksheet article.
IRS Circular 230 Notice: These statements are provided for information purposes only, are not intended to constitute tax advice which may be relied upon to avoid penalties under any federal, state, local or other tax statutes or regulations, and do not resolve any tax issues in your favor.
Understanding the 2009 Gain/Loss Summary Worksheet
IMPORTANT NOTE: This article has been customized for use by individual US taxpayers investing in securities for information purposes only. Persons are encouraged to consult a qualified tax professional with the preparation of tax returns. IB does not provide tax advice. Traders or dealers in securities, for whom other tax treatment applies, may find the worksheet helpful. The methodology used to determine the yearly gain or loss, however, differs. Traders electing the mark-to-market accounting method may consult IRS Instructions for Form 4797, page 2.
The 2009 Gain/Loss Summary Worksheet calculates the gain or loss for your securities bought and sold from January 1 through December 31 utilizing the Internal Revenue Service (IRS) guidelines. Every sell trade executed appears, including short sells, on a trade-date basis. Not all securities, however, are eligible for inclusion. For additional information, see the following article categories.
Below we have categorized information about this year's "Worksheet" within the IB Knowledge Base. Each article provides more details to assist with your understanding of this tool.
- Select What's New for the 2009 Gain/Loss Summary Worksheet for a brief overview of new additions.
- Select 2009 Gain/Loss Summary Worksheet, General Explanation, for details on the columns and fields of the “Worksheet.”
- Select 2009 Gain/Loss Summary Worksheet, Considerations, for details about limitations and adjustments on the “Worksheet.”
- Select Tax Information and Reporting page, then click the Reports and Dates tab for the year-end tax form and worksheet calendar.
- Select IRS Publication 550 for a comprehensive explanation of the IRS guidelines for determining your gain/loss.
IRS Circular 230 Notice: These statements are provided for information purposes only, are not intended to constitute tax advice which may be relied upon to avoid penalties under any federal, state, local or other tax statutes or regulations, and do not resolve any tax issues in your favor.
Why are corrected 1099-DIV forms issued ?
Form 1099-DIV is published with the classification or tax character of the dividends at the time of publication. Issuers may make adjustments or corrections following the required 1099 issue date. IB is required to re-issue a corrected 1099 with the changes when known to both you and the IRS.
Notification will be sent to you if a corrected 1099 is issued and posted in Account Management. Consult your tax advisor for further guidance.
Disclaimer: IB does not provide tax advice. These statements are provided for information purposes only, are not intended to constitute tax advice which may be relied upon to avoid penalties under any international, federal, state, local or other tax statutes or regulations, and do not resolve any tax issues in your favor. We recommend that you consult a qualified tax advisor or refer to the U.S. Internal Revenue Service.
How does a non-US person or non-US entity claim a refund of US taxes?
Overview:
Non-US persons or entities must file an income tax return with the United States tax authority in order to claim a refund of over withheld or overpaid tax.
Form 1040NR or Form 1040NR-EZ must be filed by eligible persons with the U.S. tax authority (Internal Revenue Service) to claim a refund. Use of the forms is limited to non-U.S. persons and non-U.S. entities. Those filing must have had U.S. tax withheld from U.S. source income.
For questions about "eligibility to file" or "how to file," visit the U.S. Internal Revenue Service online at www.irs.gov . Enter within the site's search engine one of the following headings for additional information:
- Publication 519, US Tax Guide for Aliens
- Taxation of Nonresident Aliens
- Instructions for Form 1040NR
Disclaimer: IB does not provide tax advice. These statements are provided for information purposes only, are not intended to constitute tax advice which may be relied upon to avoid penalties under any international, federal, state, local or other tax statutes or regulations, and do not resolve any tax issues in your favor. We recommend that you consult a qualified tax advisor or refer to the U.S. Internal Revenue Service.
Tax Reporting: When does IB send the 1099-R information to the IRS?
Background:
The information will be provided to the IRS by March 31 of the year following the year in which the IRA distribution takes place.
Tax Treaty Benefits
Overview:
Income payments (dividends and payment in lieu) from U.S. sources into your IB account may have U.S. tax withheld. Generally, a 30% rate is applied to non-U.S. accounts. Exemption from the withholding or a lower rate may apply if your home country has a tax treaty with the U.S. Complete the applicable Form W-8 to find out your status.
Background:
Tax Treaties*
U.S. tax treaties with some countries have different benefits. Legal tax residents of the following countries may be eligible for the treaty benefits. Below is a list of the tax treaty countries. Benefits vary by country.
| Australia | Czech Republic | India | Lithuania | Sweden |
| Austria | Denmark | Indonesia | Poland | Switzerland |
| Bangladesh | Egypt | Ireland | Portugal | Thailand |
| Barbados | Estonia | Israel | Romania | Trinidad & Tobago |
| Belgium | Finland | Italy | Russia | Tunisia |
| Bulgaria | France | Jamaica | Slovak Republic | Turkey |
| Canada | Germany | Japan | Slovenia | Ukraine |
| China, People's Rep. Of | Greece | Kazakhstan | South Africa | United Kingdom |
| Commonwealth of Ind. States | Hungary | Korea, Rep. of | Spain | Venezuela |
| Cyprus | Iceland | Latvia | Sri Lanka |
*Country list as of April 2009
Refer to IRS Publication 901 for details on withholding rates for your tax residence country and your eligible benefits.
Why am I required to provide a W-8 if I am not a US citizen or resident?
As IB LLC is a carrying broker domiciled in the U.S., it is required to report information and, in certain instances, make payment of withholding taxes to the U.S. tax authority, the Internal Revenue Service for all account holders. To certify oneself as a non-U.S. person, a Form W-8 is requested at the time of application and is required to be re-certified every three years thereafter. If IB does not receive the W-8 or the account holder fails to re-certify the W-8 in a timely manner, then the account holder is presumed to be a US person and, absent a W-9, may then be subject to back-up withholding taxes on interest, dividends and substitute payments in lieu, as well as gross proceeds.
By certifying yourself as a non-U.S. person through a properly completed W-8, your U.S. withholding is limited to dividends issued by US corporations. Note that virtually all countries apply withholding taxes when local companies seek to distribute dividends to externally based shareholders (whether those shareholders are corporate or not). The rate at which IB is obligated to withhold for a given payment depends largely upon whether there is a tax treaty in place between the country where the dividend paying country is based and the country of residence of the dividend recipient.
Which Tax Form Should I Select?
Overview:
3 simple questions can help you choose a tax certification form. Read the questions and select the form. For more detailed help, see Tax Information & Reporting.
Question # 1: Are you a U.S. Person or a U.S. Entity?
| • U.S. Citizen | • U.S. Business or Organization |
| • U.S. Green Card Holder | • U.S. Domestic Trust |
| • U.S. Legal Resident | |
If the answer is YES, complete Form W-9
If the answer is NO, go to # 2.
Question # 2: Do you have a U.S. Visa?
| • H-1B Visa Holder | • TN Visa Holder |
| • O-1 Visa Holder | |
If the answer is YES, find your status by the "substantial presence test." See More U.S. Legal Resident Info
If the answer is NO, go to # 3.
Question # 3: Are you a Legal Resident or Entity of another country?
*Question does Not apply to U.S. Citizens/Entities or Green Card Holders
| • Permanent Home Outside of U.S | • Entity Formed Outside of U.S. |
| •Business or Organization formed outside of U.S. | |
If the answer is YES, complete Form W-8 (U.S. Citizens, Green Card Holders, and Entities still complete the W-9.)
NOT SURE because you work, live, or study in the U.S. then, see More U.S. Legal Resident Info
Disclaimer: IB does not provide tax advice. These statements are provided for information purposes only, are not intended to constitute tax advice which may be relied upon to avoid penalties under any international, federal, state, local or other tax statutes or regulations, and do not resolve any tax issues in your favor. We recommend that you consult a qualified tax adviser or refer to the U.S. Internal Revenue Service.
Certify Your Tax Status
Overview:
Filling out a tax certification form is required to open an IB account. The forms confirm your tax status in relation to the United States. Information provided by you may lower or exempt the U.S. tax withholding on your account.
Background:
This article will help you to:
►Choose the correct certification form ►Find your tax treaty benefits
►Fill out and submit your form online ►Answer tax certification questions
Which Form Do You Pick? |
Tax Treaty Benefits |
|
Management of account activity differs for each account type. IB is a U.S. broker and must follow U.S. guidelines. 3 simple questions help you choose the right form |
Some countries have a tax treaty with the U.S. Find out if you benefit from a lower tax-withholding rate. Tax Treaty Benefit Info |
Filling Out The Form |
Tax Certification – FAQ’s |
| The certification form is direct. Supply basic account information on the true owner of the assets or entity. Select W-9 Instructions or W-8 Instructions for help. | Seek professional advice for tax questions. These common questions and answers may help you make an informed decision. Tax Certification - Frequently Asked Questions |
Disclaimer: IB does not provide tax advice. These statements are provided for information purposes only, are not intended to constitute tax advice which may be relied upon to avoid penalties under any international, federal, state, local or other tax statutes or regulations, and do not resolve any tax issues in your favor. We recommend that you consult a qualified tax advisor or refer to the U.S. Internal Revenue Service.
Cash Accounts: Does a cash account require completion of a W8 form?
If you are a non-US person or entity, Interactive Brokers is required to have a valid form W8 certifying your country of tax residence at the time of application. You may update your W8 form at any time in Account Management.
