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| Shortcut to final CG basis figure? |
DazeYaVoo |
02/21/06 |
I'm neither an accountant nor a tax guy. But, as my personal tax situation complexities have ebbed and flowed over the years, I've tried to keep up in order to do my own taxes. I can usually add two and two to get four. But sometimes I wonder if I'm adding the right two and two when it comes to doing federal income taxes.
I'm trying to look for what may be shortcut in figuring the cost basis of mutual fund shares sold in 2005. I've had a fund that has had various inflows and outflows over the past seven years. All shares were sold out last December.
Rather than going through the complicated calculations that was necessary for the intervening years' tax returns (when only a partial holding was sold), would the following return an accurate result in the unique case of selling all remaining holdings?
Assume everything is LTCG.
If we take the
Total investments made in a mutual fund
Add all distributions received
(i.e. Automatic re-investments on which taxes were paid in the year received)
Equaling Total Cost Basis for all shares ever purchased
From that, if we deduct
Total tax basis reported for any sales sold in past years
The result
Must equal Net Cost Basis for all shares remaining
Correct?
Thanks for any help.
DazeYaVoo |
Clarification/Follow-up by DazeYaVoo on 02/22/06 10:08 pm:
Thanks for your response.
However, the mutual fund uses average cost basis for their summary which is not the method I used on my taxes. I used specific share sales. In addition to the mutual fund not using the same method, they would be unaware of what I have used as a cost basis for tax purposes for the partial sales made previously on this fund. (If I had always used average cost basis, as their sheet does, then it might be accurate.)
So, bottom line is that I'm not looking for an answer as to what or where to find a specific number to put on my own tax return. Rather, I want to know if the methodology stated in my original message would accurately provide the net cost basis for all remaining shares when the fund was closed?
Thanks.
Clarification/Follow-up by jnlomonte on 02/23/06 2:45 pm:
Sorry. can't help.
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