When you sell stocks, your broker issues IRS Form 1099-B, which summarizes your annual transactions. Obviously, you don't pay taxes on stock losses, but you do have to report all stock transactions, both losses and gains, on IRS Form 8949.
Keeping this in view, what happens if I don't report stocks on taxes?
If you don't report a stock sale when filing your return, the IRS will find out about it anyway through the 1099-B filing from the broker. The best-case situation is that they will recalculate your taxes, and send you a bill for the additional amount, including interest.
Likewise, do I have to report stocks if I don't sell?
No - If your stock holdings pay no dividends or any other payouts and you did not sell any shares, then you will not need to report this information on your return.
Does Robinhood report to IRS?
Robinhood Securities IRS Form 1099: Customers who had taxable events last year will receive a 1099 from Robinhood Securities, our new clearing platform.
Are taxes automatically taken out of stock sales?
You generally must pay capital gains taxes on the stock sales if the value of the stock has gone up since you've owned it. Capital gains tax on stock you've had for more than a year is generally lower than ordinary income tax. That value, equal to the purchase price with any fees, is called the cost basis of the stock.