Do I calculate tax based on IRS tax tables on page 65 (or worksheet on page 77, 110) of https://www.irs.gov/pub/irs-pdf/i1040gi.pdf
Or
Do I calculate tax based on Qualified Dividends and Capital Gain Tax Worksheet (page 36) of https://www.irs.gov/pub/irs-pdf/i1040gi.pdf
I bought 2 year note for $100, and got discount of $10.
1099-B says
Long-Term Covered Securities
Applicable Check Box on Form 8949: D
Proceeds (Ref Box 1d): $100
Cost or Other Basis (Ref Box 1e): $90
Type of Gain or Loss: (REf. Box 2): Long-term
Check if basis reported to IRS (Ref. Box 12): X
Then I read Form 8949, Part II https://www.irs.gov/pub/irs-pdf/f8949.pdf
You must check Box D, E, or F below. Check only one box. If more than one box applies for your long-term transactions, complete a separate Form 8949, page 2, for each applicable box. If you have more long-term transactions than will fit on this page for one or more of the boxes, complete as many forms with the same box checked as you need.
I check Box D
(D) Long-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS (see Note above)
I see Note Above
Note: You may aggregate all long-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS and for which no adjustments or codes are required. Enter the totals directly on Schedule D, line 8a; you aren’t required to report these transactions on Form 8949 (see instructions).
From what I understand, I don't need to file Form 8949 because I can put totals on Schedule D, line 8a
I file Schedule D, line 8a, https://www.irs.gov/pub/irs-pdf/f1040sd.pdf
I enter $10 on line 15
15 Net long-term capital gain or (loss). Combine lines 8a through 14 in column (h). Then, go to Part III on the back . .
I enter $10 on line 16
16 Combine lines 7 and 15 and enter the result • If line 16 is a gain, enter the amount from line 16 on Form 1040, 1040-SR, or 1040-NR, line 7. Then, go to line 17 below.
Ok, I go to line 17
17 Are lines 15 and 16 both gains? Yes. Go to line 18. No. Skip lines 18 through 21, and go to line 22.
Both 15 and 16 are gains so I go to line 18
18 If you are required to complete the 28% Rate Gain Worksheet (see instructions), enter the amount, if any, from line 7 of that worksheet
What is this 28% Rate Gain Worksheet. No, I am not required to fill.
I go to line 19
19 If you are required to complete the Unrecaptured Section 1250 Gain Worksheet (see instructions), enter the amount, if any, from line 18
What is this Unrecaptured Section 1250 Gain Worksheet. No, I am not required to fill.
I go to line 20
20 Are lines 18 and 19 both zero or blank and are you not filing Form 4952? Yes. Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Forms 1040 and 1040-SR, line 16.
Don’t complete lines 21 and 22 below.
The answer is YES. 18 and 19 are both zero or blank. And I don't even know what this 4952 form is?
I understand that I must complete Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Forms 1040 and 1040-SR, line 16.
HOWEVER
When I read 1040 instructions for Line 16 (on page 30), it says
If you don’t have to file Schedule D, use the Qualified Dividends and Capital Gain Tax Worksheet in the line 16 instructions to figure your tax.
Wha??????
But I HAVE TO file Schedule D. Schedule D says
Complete the Qualified Dividends and Capital Gain Tax Worksheet in the instructions for Forms 1040 and 1040-SR, line 16.
Which one is it?????????
