Table of Contents

• Publication 550 - Introductory Material
  • Future Developments
  • Reminders
  • Introduction
    • Ordering forms and publications.
    • Tax questions.
• 1.   Investment Income
  • Topics - This chapter discusses:
  • Useful Items - You may want to see:
  • General Information
    • SSN for joint account.
    • Custodian account for your child.
    • Penalty for failure to supply SSN.
    • Certification.
    • Underreported interest and dividends.
    • How to stop backup withholding due to underreporting.
    • How to stop backup withholding due to an incorrect identification number.
    • Reporting backup withholding.
    • Nonresident aliens.
    • Penalties.
    • Savings account with parent as trustee.
  • Interest Income
    • Interest not reported on Form 1099-INT.
    • Nominees.
    • Incorrect amount.
    • Information reporting requirement.
    • Taxable Interest — General
    • Below-Market Loans
    • U.S. Savings Bonds
    • U.S. Treasury Bills, Notes, and Bonds
    • Bonds Sold Between Interest Dates
    • Insurance
    • State or Local Government Obligations
  • Discount on Debt Instruments
    • Original Issue Discount (OID)
    • Market Discount Bonds
    • Discount on Short-Term Obligations
    • Election To Report All Interest as OID
  • When To Report Interest Income
    • Constructive receipt.
  • How To Report Interest Income
    • Schedule B (Form 1040A or 1040).
    • Worksheet for savings bonds distributed from a retirement or profit-sharing plan.
    • File Form 1099-INT with the IRS.
  • Dividends and Other Distributions
    • Dividends not reported on Form 1099-DIV.
    • Nominees.
    • Ordinary Dividends
    • Capital Gain Distributions
    • Nondividend Distributions
    • Liquidating Distributions
    • Distributions of Stock and Stock Rights
    • Other Distributions
  • How To Report Dividend Income
    • Election.
    • Independent contractor.
    • Investment interest deducted.
    • Exception 1.
    • Exception 2.
    • Undistributed capital gains.
    • File Form 1099-DIV with the IRS.
  • Stripped Preferred Stock
  • REMICs, FASITs, and Other CDOs
    • REMICs
    • Collateralized Debt Obligations (CDOs)
    • FASITs
  • S Corporations
    • Limit on losses and deductions.
    • Passive activity losses.
    • Form 8582.
  • Investment Clubs
    • Investments in name of member.
    • Tax Treatment of the Club
• 2.   Tax Shelters and Other Reportable Transactions
  • Introduction
  • Topics - This chapter discusses:
  • Useful Items - You may want to see:
  • Abusive Tax Shelters
    • Rules To Curb Abusive Tax Shelters
    • Investor Reporting
    • Penalties
    • Whether To Invest
• 3.   Investment Expenses
  • Topics - This chapter discusses:
  • Useful Items - You may want to see:
  • Limits on Deductions
    • Passive activity.
    • Other income (nonpassive income).
    • Expenses.
    • Additional information.
  • Interest Expenses
    • Investment Interest
    • Limit on Deduction
  • Bond Premium Amortization
    • Special rules to determine amounts payable on a bond.
    • Basis.
    • How To Figure Amortization
    • Choosing To Amortize
    • How To Report Amortization
  • Expenses of Producing Income
    • Fees to buy or sell.
    • Including mutual fund or REMIC expenses in income.
  • Nondeductible Expenses
    • Used as collateral.
    • Short-sale expenses.
    • Expenses for both tax-exempt and taxable income.
    • State income taxes.
    • Nondeductible amount.
    • Basis adjustment.
  • How To Report Investment Expenses
  • When To Report Investment Expenses
• 4.   Sales and Trades of Investment Property
  • Introduction
    • Nominees.
  • Topics - This chapter discusses:
  • Useful Items - You may want to see:
  • What Is a Sale or Trade?
    • Dividend versus sale or trade.
    • Worthless Securities
    • Constructive Sales of Appreciated Financial Positions
    • Section 1256 Contracts Marked to Market
  • Basis of Investment Property
    • Cost Basis
    • Basis Other Than Cost
    • Adjusted Basis
    • Stocks and Bonds
  • How To Figure Gain or Loss
    • Fair market value.
    • Debt paid off.
    • Payment of cash.
    • Special Rules for Mutual Funds
  • Nontaxable Trades
    • Like-Kind Exchanges
    • Corporate Stocks
    • Exchange of Shares In One Mutual Fund For Shares In Another Mutual Fund
    • Insurance Policies and Annuities
    • U.S. Treasury Notes or Bonds
  • Transfers Between Spouses
  • Related Party Transactions
    • Gain on Sale or Trade of Depreciable Property
  • Capital Gains and Losses
    • Capital or Ordinary Gain or Loss
    • Holding Period
    • Nonbusiness Bad Debts
    • Short Sales
    • Wash Sales
    • Options
    • Straddles
    • Sales of Stock to ESOPs or Certain Cooperatives
    • Rollover of Gain From Publicly Traded Securities
    • Gains on Qualified Small Business Stock
    • Rollover of Gain From Sale of Empowerment Zone Assets
  • Reporting Capital Gains and Losses
    • Exception 1.
    • Exception 2.
    • Section 1256 contracts and straddles.
    • Market discount bonds.
    • File Form 1099-B or Form 1099-S with the IRS.
    • Capital Losses
    • Capital Gain Tax Rates
  • Special Rules for Traders in Securities
    • How To Report
• 5.   How To Get Tax Help
  • Low Income Taxpayer Clinics (LITCs).
• Publication 550 - Additional Material
• Index