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Sales and Other Dispositions of Capital Assets
Please note that, for 2012, the IRS has made significant changes to the method in which capital gains and losses are reported. In past years, capital gains and losses were to be reported directly on Schedule D, Form 1040 (Capital Gains and Losses). For 2012, however, information reported to you on Form 1099-B is provided for reporting first on Form 8949 (Sales and Other Dispositions of Capital Assets). Capital gain distributions that are paid by your mutual funds, which are reported on Form 1099-DIV (see page 2), should continue to be reported directly on Schedule D.
Form 8949 is used to report capital gains and losses that may have resulted from the sale or exchange of your mutual fund shares in 2012. You will receive Form 1099-B if you sold or exchanged shares in your non-money market or non-retirement mutual fund account, including shares in the Domini Social Equity Fund, Domini International Social Equity Fund, and Domini Social Bond Fund.
The IRS considers an exchange of shares to be the same as a sale of shares. The information from your Form 1099-B is provided for reporting in the appropriate areas of Form 8949. Part I of the form is for short-term gains or losses and Part II is for long-term gains or losses. Each sale must be reported separately.
Once Form 8949 has been prepared for your mutual fund investments, then the total short-term capital gains and losses and the total long-term capital gains and losses generally must be entered in the appropriate boxes on Schedule D, Form 1040. For additional information about completing Form 8949 or Schedule D, please review the instructions issued by the IRS or consult your tax advisor.
Please consult a professional advisor as necessary for guidance on the cost basis information needed for Form 8949 and Schedule D, and for tax, legal and investment advice.
This information is intended for general informational purposes only. It is not meant to be a substitute for professional tax advice. Please consult a professional advisor to determine your individual tax situation and for tax, legal, and investment advice. The information set forth above concerns only federal income tax, not state or local income tax, except where specifically noted.
Please refer to the Instructions for Recipients on the back of your income tax forms. Please also refer to IRS Publication 564, Mutual Fund Distributions, and IRS Publication 590, Individual Retirement Arrangements (IRAs) available at www.irs.gov or by calling the IRS at 1-800-TAX-FORM (1-800-829-3676).