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Screen WID - Wisconsin Capital Gains and Losses (1120)
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Sale of Capital Assets
Detail schedule
Enter the sale of capital assets that are not sold on installment in the
Detail schedule
statement. The application transfers information from federal Schedule D to this statement. If the Wisconsin cost / basis is different from the federal cost / basis, enter the state basis in the Cost or Basis
column in this statement. The application defaults to the federal cost / basis amount unless the Cost or Basis
column is changed. The application reports this information on Form 8949, based on the following transaction types:- Box A - Short-term transactions reported on Form 1099-B with basis reported to the IRS
- Box B - Short-term transactions reported on Form 1099-B but basis not reported to the IRS
- Box C - Short-term transactions not reported on Form 1099-B
- Box D - Long-term transactions reported on Form 1099-B with basis reported to IRS
- Box E - Long-term transactions reported on Form 1099-B but basis not reported to IRS
- Box F - Long-term transactions not reported on Form 1099-B
- Schedule D - Short-term transactions reports on Form 1099-B with basis reported to the IRS which have no adjustments
- Schedule D - Long-term transactions reported on Form 1099-B with basis reported to the IRS which have no adjustments
The Detail schedule statement includes the following fields.
- 8949 Box:Use this field to determine which unit of Form 8949 to report the transaction.
Code | Description |
|---|---|
1 | Box A or D - Reported on 1099-B showing basis was reported to the IRS |
2 | Box B or E - Reported on 1099-B showing basis was not reported to the IRS |
3 | Box C or F - Not reported on 1099-B (default) |
4 | Reported directly on Schedule D |
- 1099B Errors:Use this field to identify 1099B errors that were reported to the IRS. It is not necessary to enterTorBin theAdj Codecolumn. The application automatically prints the applicable adjustment code in theForm 8949 (f) Code(s) from instructionscolumn. Use theAdj to Gain (Loss)andAdj Codecolumns to report any other adjustments that may apply to the transaction. See theAdj Codefield for a full list of codes.
Code | Description | Form 8949 Adj Code |
|---|---|---|
1 | 1099-Box 2 Type of gain (loss) is incorrect | T |
2 | 1099-Box 1e Cost or other basis is incorrect | B |
3 | 1099-Box 1e and 2 are incorrect | B and T |
- Date Acquired / Date Sold:Enter acquired and sold dates in MM/DD/YY format. The following text is also available to print in the date fields on the form. If you leave the date fields blank, the application defaults to short-term holding period.
Code | Description | Holding Period |
|---|---|---|
V | Various | Various entered in the date field is treated as short-term holding period. |
I | Inherit | Inherit entered in the Date Acquired field is treated as long-term holding period. |
W | Worthless | Worthless entered in the Date Sold field is treated as short-term holding period. |
- Force:To force the holding period of the sale, select a code from the drop-down list. For S Corporations, code3is provided for consistency with federal code2, which indicates that an asset is a collectible. The application treats this as a long-term asset, as if it were a code2. The gain or loss is included on Schedule 5K, Net long-term capital gain (loss). The application automatically prints code C in theForm 8949 (f) Code(s) from instructionscolumn. S Corporations can also use code4or5to designate the asset as qualified small business stock (section 1202 stock). Enter4if the sale is subject to the 50-percent exclusion at the shareholder level. Code5is provided for consistency with federal code5, which indicates that the gain on sale of the section 1202 stock is subject to the 60 percent exclusion. The application reports this as a 50 percent exclusion since Wisconsin does not conform to the federal 60 percent exclusion. The section 1202 gain transfers to Schedule K, Other income.
- Adj to Gain (Loss):Use this field to adjust the amounts reported to the IRS on a 1099-B, 1099-S (or substitute statement) is incorrect, to exclude or postpone a capital gain, report a disallowed loss, etc. You must enter a code in theAdj Codefield for every amount you enter in theAdj to Gain (Loss)field. TheGain (Loss)field includes the amount you enter in theAdj to Gain (Loss)field.
- Adj Code:Use this field to enter a code for the adjustment amount you entered in theAdj to Gain (Loss)field. All adjustment amounts are required to have an adjustment code. The codes you can enter in this field are listed in the following table and in the drop-down list.
Code | Description |
|---|---|
N | Received 1099-B or 1099-S as a nominee for the actual owner |
D | Accrued market discount in box 1g |
Q | Sold or exchanged qualified small business stock |
X | Excluded gain on DC Zone assets or qualified community assets |
R | Postponed gain (QSB rollover, empowerment zone, etc.) |
W | Nondeductible loss from a wash sale |
L | Nondeductible loss other than wash sale |
E | Selling expenses or option premiums not on 1099-B or 1099-S |
C* | Disposed of collectibles, See the multiple codes note following this table. |
M | Multiple transactions reported on a single row |
O | Adjustment not explained with any other code |
MN | Code M and N (Received 1099 as nominee for actual owner) |
MD | Code M and D (Accrued marked discount in box 1g) |
MQ | Code M and Q (Sold / exchanged qualified small business stock) |
MX | Code M and X (Excluded gain DC Zone / qualified community assets) |
MR | Code M and R (Postponed gain (QSB rollover, empowerment zone, etc.)) |
MW | Code M and W (Nondeductible loss from wash sale) |
ML | Code M and L (Nonbusiness loss other than wash sale) |
ME | Code M and E (Selling expenses / option prem not on 1099-B or 1099-S) |
MC | Code M and C (Disposed of collectibles) |
MO | Code M and O (Adjustment not explained with any other code) |
WN | Code W and N (Received 1099 as nominee for actual owner) |
WD | Code W and D (Accrued market discount in box 1g) |
WQ | Code W and Q (Sold / exchanged qualified small business stock) |
WX | Code W and X (Excluded gain DC Zone / qualified community assets) |
WR | Code W and R (Postponed gain (QSB rollover, empowerment zone, etc.)) |
WL | Code W and L (Nonbusiness loss other than wash sale) |
WE | Code W and E (Selling expenses / option prem not on 1099-B or 1099-S) |
WC | Code W and C (Disposed of collectibles) |
WO | Code W and O (Adjustment not explained with any other code) |
note
You may use the
1099B Errors
, Force
, and Adj Code
fields to report multiple codes for a transaction. For example, an excluded gain must be reported for a transaction that received a Form 1099-B with an incorrect Basis and Holding period. The following data entry results in codes B
, T
, X
reported in Form 8949 column (h).- 1099B Errors=3- 1099-Box 1c and 3 are incorrect
- Adj to Gain (Loss)= amount to be excluded (enter as a negative amount)
- Adj Code=X- Excluded gain on DC Zone assets, or qualified community assets
- Gain (Loss):The application automatically calculates the gain or loss for the sale based on the information you enter in theSales Price,Cost or Basis, andAdj to Gain (Loss)fields. The Gain (Loss) column calculates before you enter information in theAdj to Gain (Loss)field, so you may use the calculation to determine the adjustment amount needed for the correct taxable gain or loss. The application automatically calculates the gain or loss for the sale based on the information you enter in theSales Price,Cost or Basis, andAdj to Gain (Loss)fields.
- FMV at S Election DateandAdj Basis at S Elect Date:If the capital asset is subject to the S Corporation built-in gains tax, enter the fair market value at the S election date and the adjusted basis at the S election date. The application calculates the amount of recognized built-in gain or loss on that asset. The built-in gains tax allocated to short-term and long-term items transfers to the respective Tax on Form 5S, Schedule Q.
- Form / Unit:Enter the form and unit number related to this activity if the sale is related to a passive activity.
Built-In Gains (S Corp)
Were assets acquired in a Section 1374(d)(8) transaction
Enter
1
if the S Corporation acquired transferred (substituted) basis property from a C Corporation, the property was owned by the S Corporation less than five years, and the property was disposed of during the current tax year. A separate built-in gain tax recognition period applies to transferred basis assets. The recognition period is measured from the date the property is acquired by the S Corporation rather than the date of election of S Corporation status.Code
1
should also be entered in this field if the S Corporation acquired property from another S Corporation that is subject to the built-in gains tax, and the built-in gain recognition period for that asset has not yet ended. The recognition period is the remainder of the original recognition period during which the transferor S Corporation was subject to the built-in gains tax with respect to that property.Enter
2
if the S Corporation has not acquired transferred basis property from a C Corporation, or from an S Corporation that is subject to the built-in gains tax.Wisconsin continues to calculate any built-in gain carryover when code
1
is entered in this field, and the S Corporation’s recognition period has been met. Wisconsin does not calculate any carryover when code 2
is entered in this field, and the S Corporation’s built-in gain recognition period has been met.