Schedule D

Schedule D is an IRS income tax form. Taxpayers use Schedule D to report realized gains and losses from the sale of capital assets, as defined by the IRS. Schedule D must show the date of sale and purchase of the asset. Schedule D must also indicate the cost or adjusted basis of the asset so the proper taxable amount can be calculated. Qualified dividends are also reported on Schedule D. Capital gains under Schedule D can be offset by capital losses up to the IRS preset amount (i.e. in 2007, $3,000 for married couple filing jointly or $1,500 if married filing separately). Note however that, under Schedule D, a short term capital loss can only offset a short term capital gain, and vice versa. If total capital losses under Schedule D is greater that the IRS preset limit, then any capital loss over such limit (i.e. carryover capital loss) can be carried to the next tax year. Assets listed on Schedule D can be affected by the wash sale rule.

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