Form 8949 Box D vs Box E vs Box F: Long-Term 1099-B Reporting Explained

You held the position for more than a year. The capital gains rate is 0%, 15%, or 20% depending on your bracket — far gentler than the ordinary-income treatment you'd get on short-term. Your broker sent a 1099-B that splits long-term transactions into separate sections, your tax software is asking you to pick Box D, Box E, or Box F on Form 8949, and the instructions don't make the criteria obvious.

The long-term box selection mirrors the short-term flow (Box A/B/C), but the stakes are different. A wrong box on a long-term sale doesn't change the tax rate, but it does change how the IRS reconciles your reported gain — and long-term positions tend to be where inherited stock, gifted shares, employer stock with weird basis history, and decade-old transferred lots all live. Those are the cases where the box choice routinely goes wrong.

This guide covers each box, the broker-section mapping, the long-term-specific edge cases (step-up basis, gift basis, qualified small business stock), and the mistakes that trigger CP2000 notices months after filing.

What Each Long-Term Box Means

Form 8949 splits long-term transactions (held more than one year) into three boxes using the same two-question rubric as the short-term side:

Box	1099-B issued?	Cost basis reported to IRS?	When to use
D	Yes	Yes	Most modern stock and ETF sales held 1+ year
E	Yes	No	Inherited shares, older lots, transferred positions
F	No	No	Private long-term holdings, foreign brokers

If you've read the Form 8949 Box A vs B vs C guide, the structure here is intentionally parallel — D mirrors A, E mirrors B, F mirrors C. The covered-security rules and the broker-reporting requirements are identical. Only the holding period changes.

The functional split: Box D is the auto-reconciled case where the IRS expects your numbers to match the broker's. Box E and Box F are the cases where you (the taxpayer) are the source of truth on cost basis because the IRS doesn't have a number to compare against.

Holding Period — The Threshold That Defines Long-Term

A position is long-term if you held it for more than one year — calculated from the day after you acquired it through the day you sold it.

Practical examples:

• Bought January 15, 2024, sold January 16, 2025 → exactly one year and one day → long-term
• Bought January 15, 2024, sold January 15, 2025 → exactly one year → short-term (one day short)
• Bought January 15, 2024, sold January 20, 2025 → long-term
• Bought February 29, 2024 (leap year), sold March 1, 2025 → long-term

Brokers calculate this automatically for typical purchases, but two situations are common holding-period traps:

1. Inherited stock — automatically long-term regardless of how long you actually held it (more on this below)
2. Gifted stock — your holding period includes the donor's holding period

If the broker's classification disagrees with your understanding, the broker's is usually right because they're tracking trade dates precisely. But verify before reporting.

The "Covered Security" Rule for Long-Term Holdings

The IRS's "covered security" classification — the basis for whether a broker must report cost basis to the IRS — depends on when you acquired the security:

• Stocks acquired on or after January 1, 2011 — covered
• Mutual funds and ETFs acquired on or after January 1, 2012 — covered
• Bonds and options acquired on or after January 1, 2014 — covered
• Less complex bonds acquired on or after January 1, 2016 — covered

For long-term positions, this means anything you bought in the last 15 years on a US broker is almost certainly covered (Box D). The exception cases are older lots, transfers from brokers that didn't pass full lot history, and certain noncovered ETFs.

The covered/noncovered distinction matters because Box D requires your reported gain to match the broker's number (since both you and the IRS have the same basis). Box E and Box F don't have that constraint — you supply the basis, and your number stands unless audited.

How Broker 1099-B Sections Map to Long-Term Boxes

Every consolidated 1099-B organizes long-term transactions into the same section headers as short-term, just under "Long-Term" instead of "Short-Term":

Broker section header	Form 8949 box
"Long-Term — Covered" / "Basis Reported to IRS"	D
"Long-Term — Noncovered" / "Basis NOT Reported to IRS"	E
Nothing (no 1099-B at all)	F

Specific broker wording for long-term sections:

• Schwab / Fidelity / Vanguard / Merrill — "Long-Term Transactions for Covered Tax Lots" (Box D) and "Long-Term Transactions for Noncovered Tax Lots" (Box E)
• E*TRADE — "Long-Term — Basis Reported" and "Long-Term — Basis Not Reported"
• Robinhood — "Long-Term — Box D" and "Long-Term — Box E" labeled directly
• TD Ameritrade / Schwab integration — Schwab format post-merger
• IBKR / Webull / TastyTrade — box letter labels

If the section headers aren't explicit, check the basis column. Long-term lots showing basis with no "noncovered" flag are Box D. Long-term lots showing basis in the column but with a "noncovered" flag in another column are Box E.

Box D: The Common Long-Term Case

Box D is where most long-term sales land for anyone with a typical US brokerage account opened in the last 10+ years. You bought VTSAX in 2018, sold in 2026 — Box D. The broker had your basis, tracked the wash sale flags, computed gain/loss, and transmitted everything to the IRS.

For Box D transactions, the IRS expects your Form 8949 columns to match the 1099-B exactly. Any deviation needs an adjustment code (see the form 8949 codes reference for the common ones). The most common adjustments on Box D:

• Wash sale disallowance (code W) — broker tracks this within an account, but if you have wash sales across multiple accounts, you may need to add a wash sale adjustment manually
• Incorrect basis (code B) — common when RSU/ESPP shares vest and the broker uses the original grant-date basis instead of the W-2-reported basis
• Ordinary income vs capital gain split for certain ESPP holdings (code E)

If you accept the broker's numbers without adjustment, Box D transactions can be summarized on Schedule D directly without filling out Form 8949 row-by-row. See the schedule D vs form 8949 explanation for when summary entry is acceptable.

Box E: Where Inherited Stock and Old Holdings Live

Box E is the long-term parallel of Box B — the 1099-B was issued, but the broker didn't report cost basis to the IRS. For long-term positions, Box E shows up in some specific recurring situations:

1. Inherited stock. When you inherit shares, your cost basis is "stepped up" to the fair market value on the date of the decedent's death. The broker often doesn't have this number — they may show $0 or the original deceased owner's basis, and they flag the lot as noncovered because the original purchase predates their tracking. You report Box E with the stepped-up basis you calculate.

2. Gifted stock. When you receive gifted shares, your basis is generally the donor's original basis (with some adjustments for gift tax paid). The broker has no way to know this and treats the lot as noncovered. Box E with your calculated basis.

3. Pre-2011 stock acquisitions. Anything bought before the 2011 covered-security cutoff and still held shows up as Box E when sold. Schwab and Fidelity may still display the basis on the 1099-B, but it's flagged as noncovered.

4. Transferred shares from older accounts. Even shares acquired post-2011 can land in Box E if they were transferred between brokers and the original lot history didn't move with them.

5. Pre-2012 mutual funds and ETFs. Same logic as pre-2011 stocks, with a one-year-later cutoff for funds.

Box E is also where most long-term basis errors live. Common problems:

• Inherited stock showing $0 basis — you may be reporting 100% of the proceeds as gain when most of it is actually a step-up exclusion
• Gifted stock showing the broker's blank basis — you need to ask the original donor for their purchase price and date
• Transferred shares showing 0 basis or "unknown" — see 1099-B noncovered securities missing cost basis for the workflow to recover basis from old account statements

Box F: Long-Term Sales With No 1099-B

Box F is the smallest bucket on the long-term side and serves the same purpose as Box C on the short-term side. It's for long-term capital sales where no 1099-B was issued at all. Common cases:

• Private company stock held long-term — selling shares of a non-public company directly to another investor
• Real estate held as a long-term investment sold without escrow generating a 1099-B (uncommon — most real estate sales generate a 1099-S, which is different)
• Foreign brokerage accounts that hold US-relevant capital assets without issuing a 1099-B
• Collectibles, art, and certain commodities held more than a year and sold privately
• Cryptocurrency held long-term and sold on exchanges that didn't issue a 1099-B (pre-2026 rules — see notes below)

For Box F transactions, the IRS has no third-party comparison. You report what you sold, when, for how much, and what you paid, and your numbers become the record. Keep documentation supporting basis and sale price — Box F audits land on you to prove.

Long-Term-Specific Edge Cases

The long-term side has several quirks that don't apply on the short-term side:

Step-up basis on inherited stock

The single most common Box E error: reporting inherited stock with the original basis instead of the stepped-up basis. If your grandmother bought MSFT for $20 in 1995 and you inherited it when it was trading at $400, your basis is $400 (date-of-death value), not $20. Selling at $410 means $10 of gain per share, not $390.

The step-up applies to most inherited capital assets unless the estate elected an alternate valuation date (allowed in specific cases up to 6 months after death). The broker won't apply this for you — you compute it from the death certificate date and the closing price that day.

Holding period inheritance

Inherited stock is automatically long-term, even if you (or the decedent) held it for less than a year. This is one of the few cases where the holding period rule doesn't apply mechanically — the IRS treats inherited capital assets as long-term by default.

Gifted stock holding period

Gifted shares carry the donor's holding period. If your father bought 100 shares in 2010 and gifted them to you in 2025, when you sell in 2026 the holding period is 16 years (from 2010), not 1 year (from 2025). This usually qualifies as long-term automatically — but the basis calculation is more involved (donor's basis, with possible gift-tax adjustment).

Qualified Small Business Stock (QSBS) — Section 1202

QSBS held more than 5 years may qualify for 100% gain exclusion under Section 1202. These are typically Box F transactions (sale of private company stock) reported with adjustment code Q. The exclusion is calculated separately and reduces the taxable gain to zero in qualifying cases — one of the largest non-obvious tax breaks for early employees of qualifying small companies.

Long-term wash sales

Wash sale rules apply equally to long-term positions, but they're less common because the holding period (1+ year) gives more time for the position to fluctuate. When they do occur, they're reported the same way as short-term wash sales — code W with the disallowed loss as an adjustment.

Collectibles rate

Long-term gains on collectibles (art, antiques, coins, gold, certain other physical assets) are taxed at a maximum 28% rate instead of the standard 0/15/20% capital gains rates. The box selection doesn't change (still D/E/F based on 1099-B status), but Schedule D has separate lines for the collectibles rate calculation.

Decision Flow: Picking the Right Long-Term Box

Same three questions as the short-term flow:

1. Did I receive a 1099-B that includes this transaction?
   • No → Box F
   • Yes → continue
2. Does the 1099-B show cost basis for this transaction?
   • Blank, "noncovered," or marked unknown → Box E
   • Has a dollar amount → continue
3. Is the section header "covered" / "basis reported to IRS"?
   • Yes → Box D
   • No → Box E

For most modern long-term sales on US brokers, you're in Box D. The exceptions are inherited shares (Box E), gifted shares (Box E), pre-2011/2012 acquisitions (Box E), and private/foreign transactions (Box F).

What Changes Between Long-Term Boxes on Form 8949

The Form 8949 column structure is identical across boxes — only the source of the numbers changes:

Column	Box D	Box E	Box F
(a) Description	Required	Required	Required
(b) Date acquired	Required	"Inherited" allowed if applicable	Required
(c) Date sold	Required	Required	Required
(d) Proceeds	Required (matches 1099-B)	Required (matches 1099-B)	Required (from your records)
(e) Cost basis	Required (matches 1099-B)	Required (from your records)	Required (from your records)
(f) Code	Only if adjusting	Only if adjusting	Only if adjusting
(g) Adjustment	Only if code present	Only if code present	Only if code present
(h) Gain/loss	Calculated	Calculated	Calculated

The "Inherited" allowance in column (b) for Box E is a Form 8949 convention — instead of a specific date acquired, you can write the word "INHERITED" because the holding period is automatically long-term regardless.

Common Mistakes

• Reporting inherited stock at original basis. Easily the most expensive error on long-term reporting. Always step up to date-of-death value.
• Lumping Box D and Box E together. Each box gets its own Form 8949 page in the IRS structure.
• Skipping Box E because basis is missing. Look up the historical price from your broker's records or external sources — never report $0 basis if a real number is reachable.
• Misclassifying gifted shares as Box D. If the donor's basis wasn't transmitted, it's Box E even if the shares are technically post-2011.
• Treating a sale of inherited stock as short-term. Inherited capital assets are automatically long-term — don't let the broker's "holding period: 3 months" display fool you if it appears.
• Forgetting to claim Section 1202 exclusion on qualifying QSBS sales. Code Q on Box F can be a 100% gain reduction — don't leave it on the table.

FAQ

My 1099-B shows a position I inherited as Box D. Should I correct it?

Possibly. If the broker stepped up the basis correctly to the date-of-death value and treats the holding as long-term and covered, Box D is acceptable. If the basis is still the decedent's original cost, the lot should be Box E with your correct stepped-up basis.

Can I have the same security in Box D and Box E?

Yes. If you bought XYZ in 2009 (Box E when sold) and again in 2018 (Box D when sold), the sales report in separate boxes on Form 8949. Common for long-held positions where lots cross the covered-security cutoff.

Does Box D get the same long-term capital gains rate as Box E and Box F?

Yes. The box assignment doesn't affect the tax rate — only how the IRS reconciles the reported numbers. All long-term boxes get the 0/15/20% long-term capital gains rates based on your income bracket (with the collectibles exception at 28%).

What if I inherited stock years ago and only just received the 1099-B for selling it?

The 1099-B reports the year of sale, regardless of when you inherited. Use the date-of-death value (which may require pulling a historical stock quote) as your basis, report it as Box E with "INHERITED" in the date-acquired column, and you're done.

Are crypto sales held long-term Box D or Box F?

Pre-2026 rules: typically Box F (no 1099-B). Starting in 2026 with the new 1099-DA reporting, long-term crypto sales from compliant exchanges will move into Box D or Box E depending on the exchange's basis tracking. See 1099-DA crypto import guide for the transition rules.

Do I have to summarize Box D on Schedule D Line 8a instead of listing each transaction?

No — summarizing is optional. If your Box D transactions have no adjustments, summary entry on Line 8a is the cleanest path. If any have wash sales, code B adjustments, or other corrections, list those individually on Form 8949 and reconcile the rest as summary.

My broker shows pre-2011 shares with basis filled in. Is it Box D or Box E?

Box E. The covered-security rule is based on when you acquired the security, not whether the broker tracks the basis internally. Even if Schwab shows the cost basis for your 1998 stock purchase, the IRS classifies it as noncovered, so it's Box E.

Bottom Line

Long-term Form 8949 boxes split the same way as short-term: Box D for "broker reported basis to IRS" (the common case), Box E for "broker sent the 1099-B but the basis isn't IRS-confirmed" (inherited, gifted, transferred, old lots), and Box F for "no 1099-B at all" (private sales, foreign, certain crypto).

The long-term-specific issues to watch — step-up basis on inheritance, donor basis on gifts, QSBS exclusion, holding period quirks — all collect in Box E and Box F. Box D is the easy case; treat the section header as authoritative and accept the broker's numbers. Box E and Box F require you to be the source of truth on basis, which means doing the math yourself and keeping documentation if the IRS asks.

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