How to Fill Out Line 3 on Schedule D Form

Schedule D is a tax form used to calculate capital gains or losses from the sale of capital assets. “Almost everything you own and use for personal or investment purposes is a capital asset,” the Internal Revenue Service explains. The difference between what you bought an item for and what you sold the item for is your capital gain or loss. Generally, barterers and brokers must provide you with a Form 1099-B to report the sale of capital property. If you don't get a 1099-B, you must fill out Line 3 on Schedule D, but you must start with Form 8949.

Visit the IRS website and grab a copy of Form 8949 and a copy of Schedule D.

Fill out Parts I and II on Form 8949 using your records of the sale. Enter your short-term property in Part I and your long-term property in Part II. Short-term property is one that you owned for a year or less. Long-term property is one that you owned for more than a year.

Check Box C in either Part I or Part II, depending on whether you sold short-term or long-term property.

Add up each column in Parts I and II. Enter the totals on the bottom of each section.

Grab Schedule D. Transfer the amounts from each column on Form 8949 to Line 3 on Schedule D.

Tips

  • Boxes A and B on Form 8949 and Lines 1 and 2 on Schedule D are for those who received a Form 1099-B. If you don't receive a 1099-B, leave Lines 1 and 2 blank.
  • You must use a separate Form 8949 for each box you check in Parts I and II. If you have a short-term sale with the basis reported and another for which you don't receive a 1099-B, you must use two forms.
 

About the Author

Angela M. Wheeland specializes in topics related to taxation, technology, gaming and criminal law. She has contributed to several websites and serves as the lead content editor for a construction-related website. Wheeland holds an Associate of Arts in accounting and criminal justice. She has owned and operated her own income tax-preparation business since 2006.