I got a letter from the IRS today. It seems that back in 2005 when I was buying and selling stocks like they were candy I filed incorrectly.
I bought, and sold, just over $10,000 in stocks that year using $5,000 of capital. My actual profit was in the neighborhood of $100, and I did my level best to make sure I paid taxes on that. However, due to some mishap on my part, the IRS now thinks that I made $10,000 in stock sales and wants a little north of $3,000 in taxes.
Hopefully it won’t take too much to sort this out.
It won’t. You typically need to send them proof of the original purchase price and then your sale price. I received a similar letter for my 2005 taxes.