Question

I am in need of Schedule D instructions. How do I complete a Schedule D tax form?

Answer

Regarding Schedule D tax instructions, if you have any sales of capital assets, you must first complete Form 8949: Sales and Dispositions of Capital Assets. Use Part I for sales of short-term assets — held for one year or less. Use Part II for sales of long-term assets — held for more than one year. You’ll need this information:

  • Description of property
  • Purchase price
  • Purchase date
  • Selling price
  • Selling date
  • Adjustments

After you enter this information, you’ll calculate the gain or loss in the last column. Enter the totals at the bottom of each part. Then, enter the results on the Schedule D tax form, on the appropriate lines (1, 2, 3, 8, 9 or 10).

You’ll then fill in other applicable information on the Schedule D tax form. This information includes:

  • Gains and losses from other forms — like Forms 4797, 6252, 8824, and others
  • Gains and losses from Schedule K-1
  • Loss carryovers
  • Qualified dividends

Enter this in Parts I (for short-term) and II (for long-term) that correspond to Form 8949, Parts I and II. In Part III, you’ll net Parts I and II. Then, you’ll calculate:

  • Which tax calculation form to use
  • How much capital gain or loss to report on Form 1040

Related Topics

Related Resources

IRS Letter 3219 – Notice of Deficiency, Increase in Tax and Notice of Your Right to Challenge

Learn more about letter 3219, why you received it, and how to handle an IRS notice of deficiency with help from the tax experts at H&R Block.

IRS Letter 3666C – Unprocessable/Transferred Claim Letter

Learn more about IRS Letter 3666C, why you received the letter, and what it means for you with help from the tax experts at H&R Block.

IRS Letter 2840C – Installment Agreement

An installment agreement has been set up for your tax balance due. Learn about IRS letter 2840C and get the facts from the tax experts at H&R Block.

IRS Letter 4213C – Reduced Installment Agreement User Fee Request Denial

Your request for a reduced installment agreement user fee was denied. Learn how to address letter 4213C with help from the tax experts at H&R Block.