Updated October 17, 2026. Quick answer: Line 7a is your capital gain or loss. If you sold a capital asset, the instructions say to complete Form 8949 and Schedule D, and the result goes on the line. A narrow exception lets some filers enter only capital gain distributions from Form 1099-DIV and check the Schedule D not required box on 7b.
More IRS forms and schedules for individual filers, read line by line: Form 8828 instructions and Form 6781 instructions.
Read box by box from the IRS form text: Form 2439 boxes 1a to 1d and Form 1099-CAP boxes 1 to 5.
IRS worksheets read line by line: Capital Loss Carryover Worksheet.
IRS worksheets from the 2025 Form 1040 instructions, read line by line: Schedule D Tax Worksheet.
Sales of business property (Form 4797), passive activity losses (Form 8582) and depreciation (Form 4562) for 2025, read line by line: Form 4797 line 8, Form 4797 lines 25 to 32 and Form 8582 Part IX.
Foreign tax credit (Form 1116) and alternative minimum tax (Form 6251) for 2025, read line by line: Form 1116 lines 15 to 19, Form 6251 lines 2d to 2h and Form 6251 line 2k.
Schedule D and Schedule E (Form 1040) for 2025, read line by line: Schedule D line 1a, Schedule D line 18 and Schedule D lines 21 and 22.
What goes on line 7a
The form caption is “Capital gain or (loss). Attach Schedule D if required”. The instructions open with the general rule: “If you sold a capital asset, such as a stock, bond, or digital asset, you must complete and attach Form 8949 and Schedule D.” The schedule is explained on the Schedule D page, and the broker form behind many sales is on the 1099-B proceeds and cost basis page. The rest of the return is mapped on Form 1040 line by line.
Exception 1: only capital gain distributions
The instructions start the exception this way: “You don’t have to file Form 8949 or Schedule D if you aren’t deferring any capital gain by investing in a qualified opportunity fund and both of the following apply.”
The two conditions are “You have no capital losses, and your only capital gains are capital gain distributions from Form(s) 1099-DIV, box 2a (or substitute statements); and” “None of the Form(s) 1099-DIV (or substitute statements) have an amount in box 2b (unrecaptured section 1250 gain), box 2c (section 1202 gain), or box 2d (collectibles (28%) gain).” Box 2a is explained on the 1099-DIV box 2a page.
When Exception 1 applies, “enter your total capital gain distributions (from box 2a of Form(s) 1099-DIV) on line 7a and check the box” for Schedule D not required on line 7b. For nominee amounts the instructions say “If you received capital gain distributions as a nominee (that is, they were paid to you but actually belong to someone else), report on line 7a only the amount that belongs to you.”
And on the tax computation: “If you don’t have to file Schedule D, use the Qualified Dividends and Capital Gain Tax Worksheet in the line 16 instructions to figure your tax.”
Exception 2: Schedule D without Form 8949
A second exception covers some filers who must still file Schedule D. The instructions begin “You must file Schedule D but generally don’t have to file Form 8949 if Exception 1 doesn’t apply, you aren’t deferring any capital gain by investing in a qualified opportunity fund or terminating deferral from an investment in a qualified opportunity fund, and your only capital gains and losses are:” The list includes “Capital gain distributions;” “A capital loss carryover from 2024;” and “A gain from Form 2439 or 6252 or Part I of Form 4797;”. The list also covers “A gain or loss from a partnership, S corporation, estate, or trust; or”. It ends with transactions reported on a Form 1099-B or 1099-DA “that shows basis was reported to the IRS”, where no adjustment is needed on Form 8949.
Line 7b: the two boxes
The form caption is “Schedule D not required Includes child’s capital gain or (loss)”. The instructions say “If Exception 1 applies, check the” Schedule D not required box on line 7b.
The second box is for a child’s amounts: “If you are including your child’s capital gain or (loss) in the total on line 7a, check the” child’s capital gain or loss box on line 7b “and enter the amount from Form 8814, line 10, in the entry space.” “For more information, see the Instructions for Form 8814.”
Where the number comes from
Line 7a comes from Schedule D when Schedule D is filed, and from Form 1099-DIV, box 2a, when Exception 1 applies. Sales of stock and other assets are reported to you on Form 1099-B; the short-term and long-term split is shown on the 1099-B box 2 page. A calculator for the resulting tax is at the capital gains tax calculator.
Where it goes next
Line 7a is part of the income total. The form’s line 9 reads “Add lines 1z, 2b, 3b, 4b, 5b, 6b, 7a, and 8. This is your total income”. Line 7a is also an input for the social security worksheet described on the lines 6a and 6b page. The total is on the lines 9, 10 and 11 page.
Edition and line numbers
This page reads the 2025 Form 1040 and its 2025 instructions. Those are the files irs.gov was serving as the current ones on 2026-10-17, and they are for the tax year 2025 return, filed in 2026. Check the tax year printed on the form in front of you and use the line numbers on that year’s form. For the 2025 edition, the instructions state: “The lines on Forms 1040 and 1040-SR are the same.” Line 7 is split into 7a and 7b in this edition; the exceptions and the line 7b boxes are as quoted above.
Common mistakes
- Skipping Form 8949 and Schedule D after a sale. The instructions say “you must complete and attach Form 8949 and Schedule D” if you sold a capital asset.
- Using Exception 1 with a box 2b, 2c or 2d amount on a Form 1099-DIV. The condition is that none of those boxes “have an amount in box 2b” and the other boxes the instructions list.
- Counting a nominee distribution in full. The instructions say to “report on line 7a only the amount that belongs to you”.
Related: Schedule D Form 1040, 1099-B proceeds and cost basis, 1099-DIV box 2a, Capital gains tax calculator, and qualified dividends and capital gain tax worksheet.
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- Instructions for Form 1040 and Form 1040-SR (2025): https://www.irs.gov/pub/irs-pdf/i1040gi.pdf
- Form 1040, U.S. Individual Income Tax Return (2025): https://www.irs.gov/pub/irs-pdf/f1040.pdf
Read from the IRS documents linked above on October 17, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.