Author Topic: Lending Club Cost Basis  (Read 6061 times)

Joleran

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Lending Club Cost Basis
« on: January 29, 2015, 01:52:44 AM »
Well, the new LC tax forms are out, and Lending Club has added a fun surprise, cost basis is now reported to the IRS, using a method that is in line with LC's traditional high standards for accuracy and reporting.  Also, cost basis has been reported for each individual Folio note transaction, so we can have more fun.

To be fair, it's only like 5 dollars off from my method, but good luck ever trying to figure that out, and it looks like some of the more optimistic methods of calculating cost basis for LC notes are about to be rendered obsolete.

Joleran

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Re: Lending Club Cost Basis
« Reply #1 on: February 03, 2015, 09:24:35 PM »
Huh, two revisions so far by LC.  Good thing I didn't try to file as early as possible!

Unfolder

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Re: Lending Club Cost Basis
« Reply #2 on: February 04, 2015, 09:43:54 AM »
Just one more thing for my poor accountant to deal with  ;D

turing

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Re: Lending Club Cost Basis
« Reply #3 on: February 04, 2015, 01:23:57 PM »
This will be my first year filing taxes with LC account.  I'm dreading it because it is new, fairly major ripple in taxes AND it sounds like LC is throwing some nice curve balls at us too.

rawraw

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Re: Lending Club Cost Basis
« Reply #4 on: February 04, 2015, 01:26:55 PM »
This will be my first year filing taxes with LC account.  I'm dreading it because it is new, fairly major ripple in taxes AND it sounds like LC is throwing some nice curve balls at us too.
Really the only tough part that I've found is the Folio transactions.  I used to manually enter them, but last year I just attached the Folio info to the return and entered the total amounts.  I'd have like 300 transactions with a total amount taxable of like $7.00 ha ha

turing

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Re: Lending Club Cost Basis
« Reply #5 on: February 04, 2015, 01:38:48 PM »
This will be my first year filing taxes with LC account.  I'm dreading it because it is new, fairly major ripple in taxes AND it sounds like LC is throwing some nice curve balls at us too.
Really the only tough part that I've found is the Folio transactions.  I used to manually enter them, but last year I just attached the Folio info to the return and entered the total amounts.  I'd have like 300 transactions with a total amount taxable of like $7.00 ha ha

I think I will be going that route too.  I don't have too many (maybe 100+) but totals with attached document sounds easier.

rawraw

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Re: Lending Club Cost Basis
« Reply #6 on: February 04, 2015, 01:40:20 PM »
This will be my first year filing taxes with LC account.  I'm dreading it because it is new, fairly major ripple in taxes AND it sounds like LC is throwing some nice curve balls at us too.
Really the only tough part that I've found is the Folio transactions.  I used to manually enter them, but last year I just attached the Folio info to the return and entered the total amounts.  I'd have like 300 transactions with a total amount taxable of like $7.00 ha ha

I think I will be going that route too.  I don't have too many (maybe 100+) but totals with attached document sounds easier.
One thing I don't know is that if Lending Club is reporting if that impacts our need to report every trade. Peter normally does a tax post every year

core

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Re: Lending Club Cost Basis
« Reply #7 on: February 04, 2015, 09:01:30 PM »
This new development is complete BS.  What, did tax laws change this year?  Or did LendingClub SCREW UP previous years? 

Prosper reported basis for TY2013.  And possibly earlier.  As much as I'd like to see things stay the way they were at LC, I'd get much more enjoyment from seeing LC get called out for their previous methods.  What, is this just going to be another case of "that was the past, just sweep it under the rug" like the IRA deal??

LC could have freaking warned us that this was coming.  You know, during the year when quarterly estimated tax payments were being made and more importantly when certain investment decisions were being made?

bobeubanks

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Re: Lending Club Cost Basis
« Reply #8 on: February 04, 2015, 09:34:55 PM »
Blame this one (mostly) on the IRS.

From the IRS explanation on what are "covered securities" under the cost basis reporting requirment:

Certain other types of securities (e.g., debt instruments and options) will be covered if acquired after January 1, 2014.

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Cost-Basis-Reporting-FAQs

(I'm not sure why the cost basis reporting faq is under small businesses & self-employed section)

core

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Re: Lending Club Cost Basis
« Reply #9 on: February 04, 2015, 09:58:27 PM »
Blame this one (mostly) on the IRS.

From the IRS explanation on what are "covered securities" under the cost basis reporting requirment:

Certain other types of securities (e.g., debt instruments and options) will be covered if acquired after January 1, 2014.

Thanks.  I had forgotten all about options reporting starting this year. 

So I guess Prosper was reporting basis in earlier year(s) just to be mean.

If nothing else, this will greatly simplify doing taxes each year.  Just put down the totals that LC spits out, correct or incorrect it doesn't matter because that's what the IRS goes by.  As many bugs as LC's stuff has, it shouldn't be too difficult to find some exploits that cause incorrect reporting and thus tax-free money.  Knock yourselves out, Lending Club.