Ron Rosenfeld <ronrosenfeld[at]nospam.org> writes:

- quote -

No. But keep your research in your files in the (very,
very) unlikely event that the IRS challenges your reported
basis.

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

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

"Business" <GrandMarquis99[at]gmail.com> wrote:

- quote -

Should any special documentation be submitted to the IRS to
indicate we are using this methodology?

Thanks.
--ron

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

Ron Rosenfeld wrote:

- quote -

I assume the stocks were publicly traded - if so, and if you
have absolutely no other hook to hang your hat on you might
try taking a look at the trading prices for the stock in the
year of acquisition - at the very least, using the lowest
retail price for the year will get you something better than
a zero cost basis. If you can narrow the time-frame for
acquisition, you can also narrow the range of possible
prices.

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

The IRS did not receive a taxpayer's return for the year
2000. The taxpayer is a US citizen but resides full-time in
a foreign country. He had US capital gains on some stock
sales for which he owes US taxes.

At the time he filled out his return, he thought he did not
owe any taxes.

I am told there is a copy of a letter in his IRS file
indicating that his return had been rejected; but no reason
is included in the letter.

In May 2002, the IRS apparently sent him a notice that they
had not received his return for 2000. However, he did not
receive that letter.

In Aug 2006 he received another letter assessing interest
and penalties on taxes due. Of course, they computed the
taxes based on the reported sales of his stocks and assumed
a zero basis. Obviously this inflated the interest and
penalties well above what the true values should have been.

He did receive the Aug 2006 letter. He has sent the IRS a
check based on a rough estimate of what he might have owed.

He has not been able to locate the records to prove the
basis of the stocks. He has contacted his broker, and has
been told they are attempting to locate the records, but
were not sure if they would be able to do so.

He does recall approximate dates of purchase, and which are
long-term vs short-term.

If his broker remains unable to locate the records to prove
the basis, what are his options?

Thanks.
--ron

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >