Maintaining cost basis on non-covered securities is the clients' responsibility for tax compliance and filing. Interactive Brokers Group does NOT report cost basis information to the IRS on non-covered security sales.
Equities purchased prior to January 1, 2011, mutual funds purchased prior to January 1, 2012, and other securities-i.e., fixed income, options and structured notes-purchased prior to January 1, 2014 are considered non-covered. Certain securities such as public traded partnerships remain uncovered.
The cost basis of uncovered securities will not be reported to the IRS but is provided to you on your form 8949 worksheet for informational purposes only. The cost basis provided on the worksheet should be verified for accuracy before using the information for your tax return. For sales of non-covered securities, your tax return should include all gross proceeds amounts IBKR reports on Form 1099-B, as the IRS will compare your tax return to what is reported. The cost basis provided on Form 1099-B for non-covered securities may require adjustment and should be validated against your own tax records.
Debt instruments and Options are reportable as of January 1, 2014 include options on stock and interests in stock, options on futures, and options on most debt instruments.
For more details of Cost Basis, consult your tax advisor or see the IRS Publication 550.
IBKR also offers tax-advantaged account types for clients who are U.S. citizen, such as IRA accounts. Please click here to learn more about these account offerings.