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So I wanted to look at form 8949 IRS or 8949 which is to help in looking at the sale and disposition of capital assets which for most people would be the sale of stock now if you sell a stock you have to categorize it as one of two things well one of a few things actually you want to see if it's a short term or long term sale right now part one of the 8949 deals with short term transactions or basically things that you've held for more than a year so if you bought this in January 1st of the year you would probably sell it January 2nd of year 2 just to be safe adding you know the next day into it part 2 of this form deals with long term transactions or ones that you've held for more than a year now the tax treatment of both movies I'll go into later but in terms of looking at the actual form let's say that you had traded Morgan Stanley and you bought it one day and you sold it the next so let's say you had any trade account and you bought like a hundred shares now if you bought this let's say first of June 4 2012 and you sold it the 1st of July that would be considered a short-term transaction so this sale proceeds that's how much that you've actually sold it for so if the stock was worth $1 and you bought a hundred shares of it what you essentially paid for it was $1,000 now let's say that you it went up another dollar so you know it's now worth $2 and you have a hundred shares so you have 200 well my math is awful then you have essentially a 100 dollar gain which is reported over here now the key is to again figure out what the if it's short term a long term but something else that's you have to take into consideration is why is this over here which is that short-term transactions reporter per basis was not reported to the IRS when basis was reported or if you didn't have it to 99 B the reasoning for this is I believe this is a requirement now that says that each stock transaction that occurs the IRS needs to be informed of the proceeds and the basis well if you ask yourself why is this it's because let's say I decide you could be a little tricky and I say that I bought my sold my shares 100 shares of Morgan Stanley for $1 for sorry $2 but my original price wasn't $1 but I actually paid $2 for it so basically I bought and sold it for nothing in which case I'd have zero gain now basically anyone could do that you could pretty much say that your basis or what you paid for it is exactly equal to your proceeds meaning that each time you bought something and you gain nothing so if you bought it for if you sold it for $500 your basis was $500 report zero gain so the essential part of this is so that at the end of the day and I hate using that phrase but I'll try to stop doing it what you report as a gain means pretty much predetermined because the basis has already been known so when you send this to the IRS and they're looking at the proceeds that can be matched to see if the gain that you report on your tax return it's also the game that they would...