IRS Instruction 8949 – IRS Forms, Instructions, Pubs 2026

IRS Instruction 8949 – IRS Forms, Instructions, Pubs 2026 – Form 8949 is essential for U.S. taxpayers who sell or dispose of capital assets such as stocks, bonds, cryptocurrencies, real estate (in certain cases), or other investments. It reconciles amounts reported on Forms 1099-B, 1099-DA, or 1099-S with your tax return, feeding into Schedule D (Form 1040) for capital gains and losses calculation.

The latest official instructions cover tax year 2025 (revised January 2026). Always check IRS.gov for updates, as tax laws can change.

What Is Form 8949 Used For?

You must use Form 8949 to report:

  • Sales or exchanges of capital assets not reported elsewhere.
  • Gains/losses from partnerships, estates, or trusts.
  • Nonbusiness bad debts.
  • Worthless securities.
  • Deferral or inclusion of gains invested in a Qualified Opportunity Fund (QOF).
  • Digital asset transactions (new specific reporting boxes for crypto, NFTs, etc.).

The form has two parts:

  • Part I: Short-term transactions (assets held 1 year or less).
  • Part II: Long-term transactions (assets held more than 1 year).

Who Must File Form 8949?

Individuals, corporations, partnerships, estates, and trusts generally file it with their return if they have reportable capital transactions. You may skip it in some cases (see exceptions below).

File Form 8949 with Schedule D on Forms 1040, 1040-SR, 1041, 1065, 1120 series, and others.

Key Changes for 2025

  • New boxes for digital assets: G/H/I (short-term) and J/K/L (long-term). Do not use boxes C or F for digital assets.
  • Digital assets are treated as property; basis includes acquisition costs and fees.
  • Updated QOF reporting rules (codes Z and Y).
  • Consistent basis rules (use Form 8971 if applicable).

How to Fill Out Form 8949: Step-by-Step?

  1. Check the appropriate box for each part (only one per page/form):
    • A/G: Basis reported to IRS on 1099-B/1099-DA.
    • B/H: Basis not reported to IRS.
    • C/I: No 1099-B/1099-DA received (use I for digital assets).
  2. Complete one row per transaction (unless exceptions apply):
    • (a) Description of property (e.g., “100 sh. XYZ Co.” or for crypto: name, units, transaction ID).
    • (b) Date acquired (or “INHERITED” or “VARIOUS”).
    • (c) Date sold/disposed.
    • (d) Proceeds (sales price).
    • (e) Cost or other basis.
    • (f) Code(s) if adjustment needed (see table below).
    • (g) Amount of adjustment (positive or negative).
    • (h) Gain or loss = (d) – (e) + (g).
  3. Total the columns and carry over to Schedule D.

Common Adjustment Codes (Column f)

  • B → Incorrect basis reported to IRS.
  • D → Market discount.
  • E → Selling expenses.
  • H → Home sale exclusion.
  • W → Wash sale.
  • Z → QOF deferral (negative amount in g).
  • Y → QOF inclusion.
  • Others: See full list in IRS instructions.

Exceptions – When You May NOT Need Form 8949?

  • Exception 1: All transactions reported on 1099-B/1099-DA with basis reported to IRS, no adjustments needed → Report totals directly on Schedule D (lines 1a or 8a).
  • Exception 2: Aggregate transactions on a statement (code M).

Download the Official IRS Instructions

Download IRS Instructions for Form 8949 (2025) PDF here:
https://www.irs.gov/pub/irs-pdf/i8949.pdf

Also see the form itself: Form 8949 (2025)

Additional Resources from IRS.gov

Pro Tip: Use tax software (TurboTax, H&R Block, etc.) or your broker’s 1099 import feature to auto-populate Form 8949. Always double-check basis and holding periods.

If you have complex transactions (QOF investments, wash sales, inherited property, etc.), consult a tax professional or refer directly to the official instructions linked above.

This guide is based on the official 2025 IRS Instructions for Form 8949 (published January 2026). Tax rules can change, so verify with IRS.gov for your specific situation.