Form 8949, Sales and Other Dispositions of Capital Assets
Capital gain or loss transactions are divided into six types and each type is reported on a separate Form 8949; the subtotals from each Form 8949 then transfer to Schedule D in aggregate. Upon completing Schedule D, the final amount transfers to Form 1040, line 23.
Within the category of short-term capital gains or losses, there are three types of transactions and each type is reported separately on a Form 8949 page 1. There can be as many as three Form 8949 page 1 attached to a tax return if a taxpayer has all three types of short-term transactions.
Long-term capital gains or losses also have three types of transactions that are reported in the same manner using Form 8949 page 2. Similarly, there can be as many as three Form 8949 page 2 with a tax return.
For short-term, the transaction types and their respective codes are:
For long-term, the transaction types and their respective codes are:
All entries are made on the Capital Gain or Loss Transactions Worksheet. The software determines the holding period and enters the information on Form 8949, provided the correct transaction codes are properly entered in both the worksheet and Forms 8949.