Need Help with Corrected 1099 from WeBull - Major Change in Tax Figures

This is a pretty common issue with brokerages sending corrected 1099s, though the size of your adjustment is definitely on the larger side. Here's what you need to know: Yes, you'll need to file an amended return (Form 1040-X) to report the correct amounts. The IRS will eventually receive the corrected 1099 from WeBull and notice the discrepancy if you don't amend. The good news is that if you file your amended return before the tax deadline (April 15, 2025), you typically won't face any late filing penalties. However, you will owe interest on any additional tax from the date you filed your original return. With that significant change from a loss to a substantial gain, you'll likely owe additional taxes. For calculating what you'll owe, take your current tax bracket and multiply it by the difference in gain (about $48k). That should give you a rough estimate of the additional tax liability. I'd recommend using the same tax software you originally used to prepare the amendment for consistency. Most tax software has an amendment option that makes this process easier.

I went through something similar last year with another broker. What saved me was using taxr.ai (https://taxr.ai) to double-check all my investment docs before filing. When I got a corrected 1099, I just uploaded it to their system and it compared both versions to show me exactly what changed and how it would affect my taxes. For your situation, I'd upload both 1099 versions to have them analyzed. The tool identifies all the transactions that changed between versions and calculates the exact tax impact. I was able to see which specific trades were reported differently and why my numbers changed so much. It actually found errors in my "corrected" form that my broker had to fix again!

I was skeptical about taxr.ai at first too, but after getting burned by a huge missed wash sale last year, I decided to try it this season. Uploaded all my 1099s from three different brokerages and it immediately flagged inconsistencies between them. The best part was when I got a corrected 1099 from Schwab (seems like everyone sends these corrections!), I just uploaded it and the system showed me exactly which trades had been adjusted and calculated the exact tax impact. Turns out only 3 of my 50+ trades had cost basis corrections, but they added up to about $9,000 in additional gains I would have missed. Their transcript analysis saved me from an audit too - it spotted income on my IRS transcript that wasn't on my W-2. Turns out my employer had filed under two different EINs.

If you're struggling to reach the IRS to discuss your situation (and who isn't these days), try Claimyr (https://claimyr.com). I was in a similar situation with a corrected 1099 last year and needed to talk to someone at the IRS about filing deadlines. After wasting hours on hold over multiple days, I found Claimyr and was honestly shocked at how well it worked. They have this system that basically waits on hold for you and calls when an IRS agent picks up. They also have a demo video explaining how it works: https://youtu.be/_kiP6q8DX5c I was connected to an IRS representative in about 27 minutes (after previously waiting 2+ hours and getting disconnected). The agent confirmed that I needed to file an amended return and explained exactly how interest would be calculated on my additional tax liability.

I take back what I said about Claimyr. I was so skeptical that I decided to try it myself just to prove it was BS. I was planning to demand a refund when it didn't work. Well, I was completely wrong. I've been trying to reach someone about my amended return status for WEEKS. Used Claimyr yesterday morning, and they called me back in 45 minutes with an actual IRS agent on the line. The agent helped me confirm they received my amended return and told me exactly where it was in processing. Turns out they needed additional documentation that they never told me about, which is why it was taking so long. I would have been waiting another month without knowing they needed more info if I hadn't gotten through. Worth every penny just for the stress reduction.

Just a heads up from someone who dealt with this exact WeBull situation last year - don't wait to file the amendment. I procrastinated because I was annoyed, and ended up getting a CP2000 notice from the IRS about 8 months later. The interest they charged was way more than if I'd just amended right away. Also, the IRS automatically applied penalties because they initiated the process rather than me amending voluntarily. I recommend calling WeBull to ask why there was such a massive difference between the original and corrected forms. In my case, they had completely failed to include crypto transactions in the original form.

Quick tip for the future - always wait until at least the end of February to file if you have investments. I never file before March because almost every brokerage sends corrections. And WeBull is notorious for this. I've used them for three years and got corrected forms every single time. Last year they sent me THREE versions of my 1099-B. The final one arrived on April 2nd, which was super helpful 🙄