Cost Basis of Stock in a Mutual Fund

Forum|Forum|6 years ago
March 11, 2020
1 reply
4 views

On one of my 1099-B's, Turbotax kicked out an entry for a $16.50 stock sale (1-d Proceeds & 6-Reported) that shows up under the heading "UNDETERMINED TERM TRANSACTIONS FOR NONCOVERED TAX LOTS". In this case the Date Acquired is N/A and the Cost or other basis is blank. I have looked at past 1099-B's and found the dividends for this company began showing up on 9/16/15 so was going to use that for date of purchase; however, I have looked through all reports I have from 2015 and cannot find the actual cost of the purchase. I have also googled historic stock prices and it is almost impossible to find them for free. Rather than keep searching for the information historic stock purchase price, can I just use $16.50?

TomYoung

Alumni - Champ

" I have looked at past 1099-B's and found the dividends for this company began showing up on 9/16/15"

That's confusing. Dividends show up on 1099-DIVs, not 1099-Bs. And why do you think the $16.50 sale here pertains to dividends in the first place? You might want to add some context here.

The fact that you're referring to 2015 and looking up historical prices suggests this is the first sale of the stock you've ever made and want to use FIFO to determine the cost basis, but it appears you've held the stock for several years so I'm puzzled why you'd sell what I assume is just a tiny bit of the stock. Maybe you didn't initiate the sale but something happened, perhaps a merger, and the stock was sold "for you?"

Seems like there's an untold story here.

"can I just use $16.50? "

Can you? Of course you "can." You can do whatever you want, though your obligation as a taxpayer is to report your income correctly and be able to justify whatever number you use here to the IRS if they ever ask. (They won't.) You can use $0, too, or any other number. You can use an "estimate" and, (again, if the IRS ever asks), they'll accept that if they deem it "reasonable." Why do you deem $16.50 a reasonable number?

(As a practical matter the dollar amount is so small that just about any number you'd put in there wouldn't trigger anything on the part of the IRS, unless you get outlandish, like claiming the basis was $15,000.00.)

fanfare

Level 15

Any mutual fund shares that were acquired on or after January 1, 2012 are covered shares.
So if the fund company doesn't know your cost, you must have purchased the fund prior to that date.

What stock/company ?
Ordinarily a mutual fund won't report stocks. Maybe this was a partial share that the fund was forced to liquidate for some reason.

Just enter a basis of zero. It won't change your life style.