Stock sale prior to divorce - how to report to IRS?


#1

My wife and I were divorced in August of 2008. Prior to the final decree (May 2009) and as part of the property settlement I sold 1000 shares of stock. My wife and I divided the money from the sale 50-50 as stipulated in the settlement agreement.

In January of 2009, I received a 1099-B reporting to the IRS, my sale of the stock. The 1099-B is in my name and has my SS number. For tax purposes, how do I indicate to the IRS that I only received half of the money from the sale and therefore should only be taxed on my portion?

I’ve been told that all the IRS cares about is the fact that the sale was reported uder my name and SS number. My ex is not disputing anything and is willing to pay taxes on her half, but we can’t figure out if the IRS will allow us to split the 1099-B since it only lists me as the stock owner.

Am I overcomplicating this or have I messed up by not planning properly for this prior to the divorce?


#2

If your ex is in agreement to pay her share of the taxes you are in good shape. You will need to consult with a tax preparer as to how to report the division to the IRS.


#3

If you have not had a final divorce granted you would file married separate on your tax returns as would your stbx. I think it would be best to have the same person prepare both your taxes since your stbx is not disputing this. It may be that filing married separate, this amount would also be included into her income and therefore would be split…