The 1099-B is a record of the value you received from the sale of the stocks - it does not tell you how much gain (or loss) you made on the sale. You report the sale of stocks on Schedule D, where you determine the capital gain (or loss) on each sale. The total of all sales you report on Schedule D should equal the amount reported on the 1099-B; that's how the IRS knows that you have reported all sales and aren't trying to hide something. Even though you never saw the cash from the sale, you enjoyed the value of the sale (as it paid off your tax liability), so you have to report the appropriate capital gains on Schedule D. So no, it's not double counting.