What is a covered security?

A security for which the broker must report cost basis to the IRS, such as stock bought for cash after 2010.

What Is Form 1099-B? A Complete 2026 Guide

Q: What is a covered security?

A covered security is a security for which the broker is generally required to report the customer's cost or other basis to the IRS. Whether a security is covered depends on the type of security and when it was acquired. For example, stock acquired for cash after 2010, mutual fund and dividend reinvestment plan shares acquired after 2011, and certain debt instruments and options acquired after 2013 are generally covered securities.

Q: What is a noncovered security?

A noncovered security is a security for which the broker is not required to report the customer's cost or other basis to the IRS. For example, stock acquired before the applicable covered-security effective date may be considered noncovered. When reporting a noncovered security, the broker may check Box 5 on Form 1099-B and, under the applicable rules, may leave certain basis and transaction-detail boxes blank.

By Charles Hardy | Last updated: October 09, 2026

What is Form 1099-B?

Form 1099-B, Proceeds From Broker and Barter Exchange Transactions, is an IRS information return that brokers and barter exchanges file to report sales, exchanges, and certain corporate actions for their customers during the calendar year.

As the broker or barter exchange, you are responsible for filing this form with the IRS and furnishing a copy to the recipient.

Form 1099-B covers three types of activity:

Broker sales for cash, including short sales, of stocks, bonds and other debt instruments, commodities, options, regulated futures contracts, forward contracts, foreign currency contracts, and securities futures contracts
Acquisitions of control or substantial changes in capital structure, where a customer received cash, stock, or other property from a corporation reportable on Form 8806
Barter exchange transactions, where members or clients trade property or services through the exchange

For digital asset transactions, brokers may also be required to report dispositions on Form 1099-DA.

Who must file Form 1099-B?

You must file Form 1099-B if you are a broker or a barter exchange that handled a reportable transaction for a customer during the year.

A broker is anyone who, in the ordinary course of business, stands ready to effect sales for others. This includes:

Securities brokerages and investment firms
Obligors that regularly issue and retire their own debt
Corporations that regularly redeem their own stock
Trustees and middlemen of widely held fixed investment trusts (WHFITs)
Qualified Opportunity Funds (QOFs) reporting dispositions of QOF interests

A barter exchange is an organization whose members or clients contract to trade property or services. Informal, noncommercial swaps of similar services don't count.

Is there a Form 1099-B reporting threshold?

For most broker sales, there is no minimum dollar threshold. Each reportable sale is reported regardless of size. A few limited exceptions apply:

Situation	Reporting rule
Fractional shares of stock	Not required if gross proceeds are less than $20
Barter exchanges	Not required if the exchange had fewer than 100 transactions in the year
Barter transactions	Not required when the fair market value is less than $1
QOF dispositions	Always reported, on a separate form for each disposition, with no exceptions

The One Big Beautiful Bill Act (OBBBA) did not change Form 1099-B reporting requirements. The $2,000 threshold applies to Forms 1099-NEC and 1099-MISC, not to broker or barter reporting.

Who is exempt from Form 1099-B reporting?

Brokers are not required to file Form 1099-B, but may choose to, for:

Exempt recipients, including corporations (with exceptions for S corporations selling covered securities acquired after 2011), charities, IRAs, Archer MSAs, HSAs, and government entities
Sales initiated by securities dealers and financial institutions
Sales of money market fund shares
Sales of foreign currency, unless under a forward or regulated futures contract requiring delivery
Spot or forward sales of agricultural commodities
Most sales of precious metals in quantities below a CFTC-approved futures contract minimum
Sales or retirements of short-term obligations issued on or after January 1, 2014
Exempt foreign persons

What’s new on Form 1099-B for the 2026 tax year?

Form 1099-B has a few updates for the 2026 tax year, including changes to address fields and reporting rules for certain digital asset transactions.

Address fields are separated: The payer's and recipient's address information is now entered in individual fields rather than combined address lines.
Digital asset sales are generally reported on Form 1099-DA: Brokers generally must report sales of digital assets effected after 2025 on Form 1099-DA instead of Form 1099-B. However, certain dual-classification assets remain reportable on Form 1099-B:

Dual classification asset	Report on
Digital only because it settles on a limited access regulated network	Form 1099-B
Section 1256 contracts on digital assets, such as regulated futures or Section 1256 options	Form 1099-B, on an aggregate basis
Money market fund shares	Form 1099-B is optional; do not file Form 1099-DA

For certain digital assets held by a widely held fixed investment trust (WHFIT), the disposition may be reported on either Form 1099-B or Form 1099-DA.

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What are the copies of Form 1099-B?

Copy	Purpose
Copy A	Filed with the IRS
Copy 1	Filed with the state tax department, where applicable
Copy B	Given to the recipient for their federal tax return
Copy 2	Given to the recipient for their state income tax return, when required
Copy C	Retained by the payer for their records

Brokers often furnish a composite substitute statement that combines Forms 1099-B, 1099-DA, 1099-DIV, 1099-INT, and 1099-OID for the year. The rules for substitute statements are in IRS Pub. 1179.

What information is required to file Form 1099-B?

Payer’s name, TIN, address, and telephone number
Recipient’s name, TIN, and address
Account number, required when filing more than one Form 1099-B for a recipient with multiple accounts, or when the FATCA filing requirement box is checked
CUSIP number, for transactional reporting by brokers
Form 8949 code (A, B, D, E, or X)
Property description, dates acquired and sold, and proceeds (Boxes 1a to 1d)
Cost basis, accrued market discount, and wash sale loss disallowed, for covered securities (Boxes 1e to 1g)
Type of gain or loss (Box 2)
Backup withholding (Box 4)
Contract profit or loss for regulated futures, foreign currency, and Section 1256 options (Boxes 8 to 11)
Gross bartering amounts (Box 13)
State information (Boxes 14 to 16)

Report each transaction on a separate Form 1099-B, except regulated futures, foreign currency, and Section 1256 option contracts, which are reported in aggregate. Short-term covered, long-term covered, and noncovered sales go on separate forms, even from a single trade. Learn more in our Form 1099-B Instructions guide.

When is the deadline to file Form 1099-B?

For the 2026 tax year (filed in 2027):

Copy	Deadline
Recipient copy	February 16, 2027
Paper filing with the IRS	March 1, 2027
Electronic filing with the IRS	March 31, 2027

The recipient deadline for Form 1099-B is normally February 15. In 2027, February 15 falls on Presidents’ Day, so it moves to February 16. See our Form 1099-B Due Date guide for state-specific deadlines.

Are there penalties for late filing of Form 1099-B?

Filed	Penalty per form
Within 30 days of the deadline	$60
After 30 days, before August 1	$130
After August 1, or not filed	$340
Intentional disregard	$680, no maximum

Form 1099-B vs. other 1099 forms

Form	What it reports	Who files it
Form 1099-B	Proceeds and basis from sales of securities, commodities, and contracts, plus barter transactions	Brokers and barter exchanges
Form 1099-DA	Proceeds and basis from digital asset sales, including tokenized securities	Digital asset brokers
Form 1099-DIV	Dividends and capital gain distributions	Corporations, mutual funds, and brokers
Form 1099-INT	Interest income, including accrued interest on bonds sold between payment dates	Banks, brokers, and other payers
Form 1099-S	Proceeds from real estate transactions, including lump-sum timber sales	Closing agents and settlement providers

Common Form 1099-B filing mistakes to avoid

Combining covered and noncovered lots. Short-term covered, long-term covered, and noncovered sales need separate forms, even when sold in one trade.
Reporting both short-term and long-term on one form. Each Form 1099-B can show only one type of gain or loss.
Forgetting to reduce proceeds. Box 1d must be reduced by commissions and transfer taxes, and Box 6 must show whether gross or net proceeds were reported.
Entering zero basis by default. Enter -0- in Box 1e only when the security actually had a basis of zero.
Skipping the wash sale adjustment. For covered securities with the same CUSIP in the same account, report the disallowed loss in Box 1g and add it to the basis of the replacement shares.
Reporting digital assets on the wrong form. Most digital asset sales, including tokenized securities, belong on Form 1099-DA.
Missing corrected forms after a transfer statement. If a late transfer statement shows a security is covered, file a corrected Form 1099-B within 30 days.
Leaving address fields unmapped for 2026. With address blocks now split into individual fields, a data import built for the old single-line format may fail validation.

How to file Form 1099-B for the 2026 tax year

You can file Form 1099-B electronically or on paper, though the IRS strongly recommends e-filing. If you file 10 or more information returns in total, you are required to e-file.

To e-file with TaxBandits:

Step 1: Create a free account.
Step 2: Select or add the business you're filing for.
Step 3: Enter the required Form 1099-B details, including proceeds, basis, and the Form 8949 code for each transaction.
Step 4: Review and transmit your return to the IRS and applicable states.

E-File Form 1099-B Now, starting as low as $0.80/form.

Frequently asked questions

No, for most broker sales. Limited exceptions apply, such as fractional share sales under $20 and barter exchanges with fewer than 100 transactions a year.

Generally no. Digital asset sales go on Form 1099-DA, with limited exceptions for certain dual classification assets.

Only when filing on paper. Form 1096 is not required for e-filing.

File a corrected Form 1099-B as soon as the error is identified. If a late transfer or issuer statement changes basis, file the correction within 30 days.

A covered security is a security for which the broker is generally required to report the customer's cost or other basis to the IRS. Whether a security is covered depends on the type of security and when it was acquired. For example, stock acquired for cash after 2010, mutual fund and dividend reinvestment plan shares acquired after 2011, and certain debt instruments and options acquired after 2013 are generally covered securities.

A noncovered security is a security for which the broker is not required to report the customer's cost or other basis to the IRS. For example, stock acquired before the applicable covered-security effective date may be considered noncovered. When reporting a noncovered security, the broker may check Box 5 on Form 1099-B and, under the applicable rules, may leave certain basis and transaction-detail boxes blank.

If your recipient has questions about their 1099-B

Recipients often contact their broker once the form arrives, especially when basis is missing or a wash sale appears. Clear answers reduce correction requests and support tickets during filing season.

The sale was likely a noncovered security, such as stock bought before 2011. Brokers don’t have to report basis for these, so the recipient uses their own records to figure gain or loss.

Code	Meaning
A	Short-term, basis reported to the IRS
B	Short-term, basis not reported to the IRS
D	Long-term, basis reported to the IRS
E	Long-term, basis not reported to the IRS
X	Holding period unknown, so the recipient decides between B and E

If the recipient sold at a loss and bought substantially identical securities within 30 days, part of the loss is disallowed. That amount is added to the basis of the new shares, so it isn’t lost permanently.

Short-term, long-term, and noncovered lots must be reported on separate forms, even when they were sold together.

For 2026, most digital asset sales are reported on Form 1099-DA, not Form 1099-B.

File Form 1099-B with Confidence

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