Every person doing business as a broker shall, when required by the Secretary, make a return, in accordance with such regulations as the Secretary may prescribe, showing the name and address of each customer, with such details regarding gross proceeds and such other information as the Secretary may by forms or regulations require with respect to such business.

Every person required to make a return under subsection (a) shall furnish to each customer whose name is required to be set forth in such return a written statement showing—

(1) the name, address, and phone number of the information contact of the person required to make such return, and

(2) the information required to be shown on such return with respect to such customer.

For purposes of this section—

The term “broker” includes—

(A) a dealer,

(B) a barter exchange, and

(C) any other person who (for a consideration) regularly acts as a middleman with respect to property or services.

(2) Customer The term “customer” means any person for whom the broker has transacted any business.

(3) Barter exchange The term “barter exchange” means any organization of members providing property or services who jointly contract to trade or barter such property or services.

(4) Person The term “person” includes any governmental unit and any agency or instrumentality thereof.

If any broker—

(1) transfers securities of a customer for use in a short sale or similar transaction, and

receives (on behalf of the customer) a payment in lieu of—

(A) a dividend,

(B) tax-exempt interest, or

(C) such other items as the Secretary may prescribe by regulations,

For purposes of this subsection, the term “real estate reporting person” means any of the following persons involved in a real estate transaction in the following order:

(1) In general In the case of a real estate transaction, the real estate reporting person shall file a return under subsection (a) and a statement under subsection (b) with respect to such transaction.

For purposes of this subsection, the term “real estate reporting person” means any of the following persons involved in a real estate transaction in the following order:

(A) the person (including any attorney or title company) responsible for closing the transaction,

(B) the mortgage lender,

(C) the seller’s broker,

(D) the buyer’s broker, or

(E) such other person designated in regulations prescribed by the Secretary.

(3) Prohibition of separate charge for filing return It shall be unlawful for any real estate reporting person to separately charge any customer for complying with any requirement of paragraph (1). Nothing in this paragraph shall be construed to prohibit the real estate reporting person from taking into account its cost of complying with such requirement in establishing its charge (other than a separate charge for complying with such requirement) to any customer for performing services in the case of a real estate transaction.

In the case of a real estate transaction involving a residence, the real estate reporting person shall include the following information on the return under subsection (a) and on the statement under subsection (b):

(A) The portion of any real property tax which is treated as a tax imposed on the purchaser by reason of section 164(d)(1)(B).

(B) Whether or not the financing (if any) of the seller was federally-subsidized indebtedness (as defined in section 143(m)(3)).

Paragraph (1) shall not apply to any sale or exchange of a residence for $250,000 or less if the person referred to in paragraph (2) receives written assurance in a form acceptable to the Secretary from the seller that—

(A) In generalParagraph (1) shall not apply to any sale or exchange of a residence for $250,000 or less if the person referred to in paragraph (2) receives written assurance in a form acceptable to the Secretary from the seller that— (i) such residence is the principal residence (within the meaning of section 121) of the seller, (ii) if the Secretary requires the inclusion on the return under subsection (a) of information as to whether there is federally subsidized mortgage financing assistance with respect to the mortgage on residences, that there is no such assistance with respect to the mortgage on such residence, and (iii) the full amount of the gain on such sale or exchange is excludable from gross income under section 121. If such assurance includes an assurance that the seller is married, the preceding sentence shall be applied by substituting “$500,000” for “$250,000”. The Secretary may by regulation increase the dollar amounts under this subparagraph if the Secretary determines that such an increase will not materially reduce revenues to the Treasury.

(B) Seller For purposes of this paragraph, the term “seller” includes the person relinquishing the residence in an exchange.

Any person engaged in a trade or business and making a payment (in the course of such trade or business) to which this subsection applies shall file a return under subsection (a) and a statement under subsection (b) with respect to such payment.

(1) In general Any person engaged in a trade or business and making a payment (in the course of such trade or business) to which this subsection applies shall file a return under subsection (a) and a statement under subsection (b) with respect to such payment.

This subsection shall apply to any payment to an attorney in connection with legal services (whether or not such services are performed for the payor).

(A) In general This subsection shall apply to any payment to an attorney in connection with legal services (whether or not such services are performed for the payor).

(B) Exception This subsection shall not apply to the portion of any payment which is required to be reported under section 6041(a) (or would be so required but for the dollar limitation contained therein) or section 6051.

For purposes of subparagraph (A)—

(1) In general If a broker is otherwise required to make a return under subsection (a) with respect to the gross proceeds of the sale of a covered security, the broker shall include in such return the information described in paragraph (2).

For purposes of subparagraph (A)—

(A) In general The information required under paragraph (1) to be shown on a return with respect to a covered security of a customer shall include the customer’s adjusted basis in such security and whether any gain or loss with respect to such security is long-term or short-term (within the meaning of section 1222).

(B) Determination of adjusted basisFor purposes of subparagraph (A)— (i) In generalThe customer’s adjusted basis shall be determined— (I) in the case of any security (other than any stock for which an average basis method is permissible under section 1012), in accordance with the first-in first-out method unless the customer notifies the broker by means of making an adequate identification of the stock sold or transferred, and (II) in the case of any stock for which an average basis method is permissible under section 1012, in accordance with the broker’s default method unless the customer notifies the broker that he elects another acceptable method under section 1012 with respect to the account in which such stock is held. (ii) Exception for wash sales Except as otherwise provided by the Secretary, the customer’s adjusted basis shall be determined without regard to section 1091 (relating to loss from wash sales of stock or securities) unless the transactions occur in the same account with respect to identical securities. (iii) Treatment of uncorrected de minimis errors Except as otherwise provided by the Secretary, the customer’s adjusted basis shall be determined by treating any incorrect dollar amount which is not required to be corrected by reason of section 6721(c)(3) or section 6722(c)(3) as the correct amount.

For purposes of this subsection—

(A) In generalThe term “covered security” means any specified security acquired on or after the applicable date if such security— (i) was acquired through a transaction in the account in which such security is held, or (ii) was transferred to such account from an account in which such security was a covered security, but only if the broker received a statement under section 6045A with respect to the transfer.

(B) Specified securityThe term “specified security” means— (i) any share of stock in a corporation, (ii) any note, bond, debenture, or other evidence of indebtedness, (iii) any commodity, or contract or derivative with respect to such commodity, if the Secretary determines that adjusted basis reporting is appropriate for purposes of this subsection, and (iv) any other financial instrument with respect to which the Secretary determines that adjusted basis reporting is appropriate for purposes of this subsection.

(C) Applicable dateThe term “applicable date” means— (i) January 1, 2011, in the case of any specified security which is stock in a corporation (other than any stock described in clause (ii)), (ii) January 1, 2012, in the case of any stock for which an average basis method is permissible under section 1012, and (iii) January 1, 2013, or such later date determined by the Secretary in the case of any other specified security.

(4) Treatment of S corporations In the case of the sale of a covered security acquired by an S corporation (other than a financial institution) after December 31, 2011, such S corporation shall be treated in the same manner as a partnership for purposes of this section.

(5) Special rules for short sales In the case of a short sale, reporting under this section shall be made for the year in which such sale is closed.

(6) Special rule for certain stock held in connection with dividend reinvestment plan For purposes of this subsection, stock acquired before January 1, 2012, in connection with a dividend reinvestment plan shall be treated as stock described in clause (ii) of paragraph (3)(C) (unless the broker with respect to such stock elects not to have this paragraph apply with respect to such stock).

For purposes of this section, if a covered security is acquired or disposed of pursuant to the exercise of an option that was granted or acquired in the same account as the covered security, the amount received with respect to the grant or paid with respect to the acquisition of such option shall be treated as an adjustment to gross proceeds or as an adjustment to basis, as the case may be.

(1) Exercise of option For purposes of this section, if a covered security is acquired or disposed of pursuant to the exercise of an option that was granted or acquired in the same account as the covered security, the amount received with respect to the grant or paid with respect to the acquisition of such option shall be treated as an adjustment to gross proceeds or as an adjustment to basis, as the case may be.

(2) Lapse or closing transaction In the case of the lapse (or closing transaction (as defined in section 1234(b)(2)(A))) of an option on a specified security or the exercise of a cash-settled option on a specified security, reporting under subsections (a) and (g) with respect to such option shall be made for the calendar year which includes the date of such lapse, closing transaction, or exercise.

(3) Prospective application Paragraphs (1) and (2) shall not apply to any option which is granted or acquired before January 1, 2013.

(4) Definitions For purposes of this subsection, the terms “covered security” and “specified security” shall have the meanings given such terms in subsection (g)(3).

(Aug. 16, 1954, ch. 736, 68A Stat. 747; Pub. L. 94–455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L. 97–248, title III, § 311(a)(1), Sept. 3, 1982, 96 Stat. 600; Pub. L. 98–369, div. A, title I, § 150(a), title VII, § 714(e)(1), July 18, 1984, 98 Stat. 690, 961; Pub. L. 99–514, title XV, §§ 1501(c)(4), 1521(a), Oct. 22, 1986, 100 Stat. 2737, 2746; Pub. L. 100–647, title I, § 1015(e)(1)(A), (2)(A), (3), title IV, § 4005(g)(3), Nov. 10, 1988, 102 Stat. 3569, 3570, 3650; Pub. L. 101–239, title VII, § 7814(c)(1), Dec. 19, 1989, 103 Stat. 2413; Pub. L. 101–508, title XI, § 11704(a)(25), Nov. 5, 1990, 104 Stat. 1388–519; Pub. L. 102–486, title XIX, § 1939(a), Oct. 24, 1992, 106 Stat. 3034; Pub. L. 104–168, title XII, § 1201(a)(5), July 30, 1996, 110 Stat. 1469; Pub. L. 104–188, title I, § 1704(o)(1), Aug. 20, 1996, 110 Stat. 1886; Pub. L. 105–34, title III, § 312(c), title X, § 1021(a), Aug. 5, 1997, 111 Stat. 839, 922; Pub. L. 109–135, title IV, § 412(xx), Dec. 21, 2005, 119 Stat. 2640; Pub. L. 110–343, div. B, title IV, § 403(a), Oct. 3, 2008, 122 Stat. 3854; Pub. L. 113–295, div. A, title II, § 210(f)(4), Dec. 19, 2014, 128 Stat. 4032; Pub. L. 114–113, div. Q, title II, § 202(c), Dec. 18, 2015, 129 Stat. 3077.)