I have a scenario here. I am just wondering what you guys think I should do. Say I made toughly 50 buy and sell transaction in a brokerage account last year. I made about 3g profit. Since I traded so many times, I can’t keep track all the transaction and have no paper documents. The money is still tied in other investments now. My question is do I need to report the gain? Do tax auditors actually care about such small amount. If I file for tax, what should I do without all the supporting documents?
Your brokerage should send you a tax document for use in filing your taxes. They also submit this electronically to the IRS. Failure to claim income that is submitted via these electronic documents are a big thing that will trigger an audit. This is assuming you’re in the US.