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Frequently Asked Tax Questions

Capital Gains, Losses/Sale of Home - Stocks (Options, Splits, Traders)


Rev. date: 1/2009

How do I figure the cost basis of stock that has split, giving me more of the same stock, so I can figure my capital gain (or loss) on the sale of the stock?


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previous topic occurrence Basis next topic occurrence
previous topic occurrence Capital Gains and Losses next topic occurrence
previous topic occurrence Cost Basis next topic occurrence
previous topic occurrence Investment Income and Expenses next topic occurrence
previous topic occurrence Publication 551 next topic occurrence
previous topic occurrence Sale of Property, Gain or Loss next topic occurrence
previous topic occurrence Stock Sale next topic occurrence
previous topic occurrence Stock Split next topic occurrence

If the old stock and the new stock are identical:
If the old shares were purchased in separate lots for differing amounts of money:

Rev. date: 1/2009

Do I need to pay taxes on the additional stock that I received as the result of a stock split?


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previous topic occurrence Capital Gains and Losses next topic occurrence
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Rev. date: 1/2009

Should I advise the IRS why amounts reported on Form 1099-B do not agree with my Schedule D for proceeds from short sales of stock not closed by the end of year?


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previous topic occurrence Capital Gains and Losses next topic occurrence
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previous topic occurrence Stock Sale next topic occurrence

If you are able to defer the reporting of gain or loss until the year the short sale closes, there are certain notations you can make on you Form 1040, Schedule D (PDF), Capital Gains and Losses that will allow you to reconcile your Form 1099-B (PDF) to your Form 1040, Schedule D (PDF) and still not recognize the gain or loss from the short sale. You will also need to attach a statement explaining the details of your short sale and that it was not closed as of the end of the year. Include your name as it appears on the return and your social security number.
For more specific rules refer to Publication 550, Investment Income and Expenses.

Rev. date: 1/2009

I purchased stock from my employer under an employee stock purchase plan. Now I have received a Form 1099-B from selling it. How do I report this?


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previous topic occurrence Capital Gains and Losses next topic occurrence
previous topic occurrence Employee Stock Ownership Plan next topic occurrence
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previous topic occurrence Stock Options next topic occurrence
previous topic occurrence Stock Sale next topic occurrence
previous topic occurrence Stock options Employee stock purchase plans next topic occurrence

The holding period requirement is satisfied if:
If the special holding period requirement:
If the holding period requirement is satisfied but the option exercise price is below the fair market value of the stock at the time the option was granted:

If you sell the stock for less than the sum of the amount you paid for it plus the amount reported as compensation, your loss is a capital loss, but you still may have ordinary income.

Rev. date: 1/2009

How do I report participation in an employee stock purchase plan on my tax return?


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previous topic occurrence Employee Stock Ownership Plan next topic occurrence
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If you participated in an employee stock purchase plan:
The holding period requirement is satisfied if:

Rev. date: 1/2009

How do I figure the cost basis when the shares I'm selling were purchased at various times and at different prices?


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previous topic occurrence Basis next topic occurrence
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previous topic occurrence Mutual Fund Distributions next topic occurrence
previous topic occurrence Stock Sale next topic occurrence

If you can identify which shares of stock you sold, your basis is:
If you cannot adequately identify the shares you sold and you bought the shares at various times for different prices, the basis of the stock sold is:

Rev. date: 1/2009

How do I compute the basis for stock I sold, when I received the stock over several years through a dividend reinvestment plan?


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previous topic occurrence Basis next topic occurrence
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previous topic occurrence Dividend Reinvestment next topic occurrence
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previous topic occurrence Publication 551 next topic occurrence
previous topic occurrence Stock Sale next topic occurrence

The basis of stock that you received through a dividend reinvestment plan: 
The first-in first-out rule means:

Rev. date: 1/2009

How are reinvested dividends reported on my tax return?


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Interest & Dividend Income
previous topic occurrence Investment Income and Expenses next topic occurrence

Reinvested dividends:

NOTE: Keep records of the dollar amount of the reinvested dividends, the number of additional shares purchased, and the purchase dates. You will need this information to establish your basis when you sell the shares.
previous pagePrevious Page: Capital Gains, Losses/Sale of Home > Property (Basis, Sale of Home, etc.)
next pageNext Page:  Sale or Trade of Business, Depreciation, Rentals > Depreciation & Recapture
 Use previous pagenext page to find additional instances of index items.