Get your taxes done using TurboTax

We are not offering tax advice here.  Rather advice as to how to use TurboTax; the point is that the brokerage firms report information to the IRS and they also report the same information plus extra to you.

 

TurboTax includes the extra, wantonly.

 

We need to be honest; so if we know we have an exceptional situation we have to take care.  I used the example of a 0 basis as a counter example - that was something I was suggesting TurboTax might do if the brokerage company didn't know the basis - and that was something that we do need to watch out for.  TurboTax really, seriously, does not help with complex tax situations like this.  The best they do is tell you you have to work it out for yourself; I know this from experience.

 

Brokerage firms correctly report wash sales within the account, possibly within the firm.  I know this from Schwab and TD Ameritrade reports.  If you have multiple brokerage accounts (as I do) you know the danger of wash sales.   If you have an IRA you ++know the danger of wash sales.  TurboTax will not help you; it does not correctly recognize the buy and sale of the same stock within different accounts even though TurboTax has all the data to do so.

 

Dividend reinvestment is something I abandoned at the end of the last millennium.  At that time it was a reporting nightmare - TurboTax did not support cost basis averaging, most likely it still doesn't.  Quicken could generate the numbers but it was still an Intuit product so basically as trustworthy as a dog on acid.

 

These days brokerage firms are simply required by law (? Obama executive action) to correctly record the numbers so dividend reinvestment is attractive as a self correcting (evolutionary) investment strategy, based on actual return not fictitious potential 😉

 

If you are seriously trying to draw me into a debate about stepped up basis I suggest you go suck your toenails.