iStrain <exceptionsTakeThisOutDude[at]earthlink.net> writes:

- quote -

They should be included in the sale of the block of stock
where they were incurred.

- quote -

Let's say you bought the first block of 200 [at] $50, the
second block of 200 [at] $60 plus a $35 fee, and the third
block of 200 [at] $75.

Then the cost basis of the blocks are:
* First block: $10,000
* Second block: $12,035
* Third block: $15,000

When you sell, you are deemed to be selling the oldest
shares first, unless you make a valid specific
identification to the broker, before the sale, of which
block you are selling, and have that confirmed in writing.
You *cannot* match things up after the fact.

So when you made the sale of 100sh, you sold half of the
first block. Therefore your basis for that sale was $5,000.

When you made the next sale of 200sh, you sold the remaining
half of the first block and half of the second block. So
your basis for that sale was $5,000 + $6,017.50 = $11,017.50

And when you sold the final 300sh, you sold the remaing half
of the second block and all of the third block. So your
basis for that sale was $6,017.50 + $15,000 = $21,017.50

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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iStrain <exceptionsTakeThisOutDude[at]earthlink.net> wrote:

- quote -

If these were all long-term or all short-term, then it nets
out the same, and there's no difference in tax; in this
case, I don't think the IRS will mind if you include the
fees in the wrong purchase lot. But if some of the lots
were held short-term and others long-term, you need to
include the fees in the correct lots so that you calculate
the correct short-term and long-term capital gains.

So if the fee was charged for the second lot, you should
include half of it in the sale of 200 shares, and the other
half in the sale of 300 shares. I'm assuming you didn't
designate specific shares when selling, so you're assuming
to have sold FIFO.

--
Barry Margolin, barmar[at]alum.mit.edu
Arlington, MA

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"iStrain" <exceptionsTakeThisOutDude[at]earthlink.net> wrote:

- quote -

You need to associate the fees with the transaction on which
they were charged. Fees other than those associated with
transactions are miscellaneous itemized deductions; they
don't belong on Schedule D (unless you pay an asset-based
management fee and elect to spread it over all transactions
in the year).

--
Tom Healy, CPA
Boulder, CO
Web: http://www.tomhealycpa.com

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I bought a particular stock in several blocks (spread out
over time), and sold it in a similar fashion. My records
from E*Trade show that some of the transactions had fees,
and some didn't.

While working on my taxes (in TurboTax), I calc'ed the cost
basis for the stocks for each sale in a sensible way, but
I'm not too sure about the fees; should I have spread them
out equally over the cost of the purchases, or throw it in
to a particular cost basis? I did the latter, since it
seemed to make the most sense, and I'm thinking that it's
not such a big deal.

For example, if I bought three lots of 200 AAPL, and one had
a fee, and then I sold 100, 200, and then 300 at various
times, I included the fees in the sale of 300.

I'm going to go over it again to doublecheck, but I'd
appreciate any advice..

Thx
Mike

--
"It's beyond my ken... and my Barbie, and all of my action figures."

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