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Have More Than 10,000 Transactions on TurboTax? Here’s The Fix

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As an active trader, dealing with taxes can be a challenging task, especially when you have a high volume of transactions. Traditional tax software like TurboTax recommends summarizing transactions when you exceed 10,000 trades, which is not only tedious but also prone to errors. This is where TraderFyles steps in to streamline your tax filing process, ensuring accuracy and ease, especially for users accustomed to TurboTax.

How do I enter a large number of transactions in TurboTax?

If you have more than 10,000 individual transactions in one or more brokerage accounts, you can’t. If you hit the transaction import limit, they recommend you enter a summary of your transactions for each sales category.

That’s only part of the steps the IRS requires in order to be fully compliant. Let’s look at the Form 8949 Instructions from the IRS.

IRS Form 8949 2023 Instructions from https://www.irs.gov/pub/irs-pdf/i8949.pdf

Form 8949 Instructions state you do not have to file a Form 8949 if:

  • Your Form 1099-B doesn’t show any adjustments in box 1f or 1g;
  • The Ordinary box in box 2 isn’t checked;
  • You don’t need to make any adjustments to the basis or type of gain (or loss) reported on Form 1099-B (or substitue statement), or to your gain (or loss); and
  • You aren’t electing to defer income due to an investment in a QOF and aren’t terminating deferral from an investment in a QOF.

Let’s take a closer look at the first bullet referencing adjustments in box 1g, as this will apply to most active traders using a cash reporting cost-basis method.

What amounts are listed in Box 1g on Form 8949?

Wash sales. Yeah, the dreaded wash sales. If you’re reading this, you’re likely familiar with those. If not, in short, this is the example the IRS gives us:

Example: Your customer Alex buys 100 shares for $1,000 in September 2023. In October 2023, he sells them for $600. Within 30 days of the sale, he buys 75 shares with the same CUSIP number in the same account. Since his loss is $400 ($1,000 minus $600) but the loss on 75 shares is disallowed, his disallowed loss is $300. Report the $600 gross proceeds from the sale in box 1d, $1,000 basis in box 1e, and $300 wash sale loss disallowed in box 1g. The $300 in disallowed loss is added to his basis in the newly purchased 75 shares.

https://www.irs.gov/instructions/i1099b#en_US_2023_publink100014778:~:text=Example.%20Your%20customer%20Alex,the%20newly%20purchased%2075%20shares.

So do you need to file a Form 8949 if you have wash sales? The answer is yes. The best practice is to attach a Form 8949 to your Schedule D so you are compliant with the Form 8949 Instructions.

Steps to Fix Transaction Limits on TurboTax

Step 1. Enter sales totals in TurboTax.

TurboTax Online
  1. Open or continue your return (if it’s not already open) and search for ‘stock sales‘.
  2. Select the Jump to link in the search results.
  3. Answer Yes to Did you sell any of these investments in 2023?
    • If you land on Your investment sales summary, select Add more sales
  4. On the OK, let’s start with one investment type screen, select Stocks, Bonds, Mutual Funds, then Continue.
  5. On the Let’s import your tax info screen, select I’ll type it myself.
  6. Step through the interview and select Sales section totals when prompted to choose how to enter your sales.
  7. You’ll now be able to enter the total proceeds (sales) and cost basis, along with the sales category. Refer to your 1099-B for the amounts and category. When finished, select Continue.
  8. You can add additional sales totals by selecting the Add another sales total on the Review your sales section totals screen.
TurboTax Desktop
  1. Open or continue your return (if it’s not already open) and search for stock sales.
  2. Select the Jump to link in the search results.
  3. Answer Yes to Did you sell any investments in 2023?
    • If you land on Here’s all the investment accounts we have so far, select Add more sales
  4. Answer Yes to Did you get a 1099-B or a brokerage statement for these sales?
  5. On the screen Let Us Enter Your Investment Sale Info, select I’ll type it in myself and Continue.
  6. Enter the name of your bank or brokerage on the screen Which bank or brokerage sent you this form? and Continue.
  7. On the screen Tell us about your 1099-B, select I’ll enter a summary for each sales category.
  8. You’ll now be able to enter the total proceeds (sales) and cost basis, along with the sales category. Refer to your 1099-B for the amounts and category. When finished, select Continue.
  9. On the screen Do you have another sale to enter from your 1099-B? select Yes to enter more sales from your 1099-B, or No to see a summary of the sales you already entered, then select Continue.
  10. Once you’ve entered all the sales on your 1099-B, you’ll see a summary of all the sales reported. Select Done.

Step 2. Generate Form 8949

  1. Create an account on TraderFyles and choose the ‘Essential‘ tier.
  1. Choose ‘New Report‘ and then choose one of the two tax reporting options:
    • 1099-B Match (most common) – if you want to generate Form 8949 quickly from Form 1099-B .PDF file or .CSV using our generic format;
    • Audit My Broker, if you want to perform an independent gain/loss calculation to verify your broker(s) reported your gains/losses correctly before generating tax documents. Choose this reporting method if you think your broker(s) may have reported your gains/losses incorrectly.
  2. Upload. Upload your transactions using your Form 1099-B .PDF file or transaction history .CSV file to TraderFyles. Note: if you are using .CSV file(s) of your transcation history, you must use our generic format. Template can be downloaded in the app.
  3. Review. Once your transactions are uploaded, review them for accuracy. TraderFyles allows you to edit or add transactions if needed, ensuring your tax report is precise. Then, check to make sure your Total Sales Proceeds match the sales proceeds on your Form 1099-B(s). If you have multiple accounts, don’t forget to total them all together and then verify.
  4. Generate Form 8949. With your transactions verified, choose ‘Generate Documents‘ to generate the necessary tax documents, then choose ‘Form 8949‘. The form will be generated immediately. Download the file and print it.

If you’re e-filing with TurboTax Online, you need to mail the IRS a copy of your 8949 (along with Form 8453) within three days after the IRS has accepted your e-file. Here’s the mailing address:

Internal Revenue Service
Attn: Shipping and Receiving, 0254
Receipt and Control Branch
Austin, TX 73344-0254

For further assistance or queries, feel free to contact our support team at hello@traderfyles.com or visit our comprehensive FAQ section on the TraderFyles Help Center.

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