The settlor of a trust owned shares of a mutual fund as her sole and separate property. The settlor created a trust in 2004. The settlor died in SEP 2011. The trustee then transferred the mutual fund into the trust in JAN 2012.
In 2018 the trustee sold all shares of the mutual fund. The 2018 Form 1099-B sent by the brokerage breaks the sale down into three parts:
1. "Short-term transaction(s) for which basis is reported to the IRS; report on Form 8949, Part I, with Box A checked."
2. "Long-term transaction(s) for which basis is reported to the IRS; report on Form 8949, Part II, with Box D checked."
3. "Transaction(s) for which basis is NOT reported to the IRS and short-term or long-term determination is unknown. You must determine the short-term or long-term basis based upon your records and report it on Form 8949, Part I, with Box B checked, or Part II, with Box E checked, as appropriate"
For No. 3 above, the brokerage firm has UNKNOWN for the acquisition date and also does not seem to know the Cost or Other Basis (having simply marked that box (1e) with the symbol "@"). I have used the settlor's date of death (DOD) as the "Date Acquired" and have calculated the Basis as the number of shares owned on the DOD multiplied by fund's NAV on the DOD. Is this the correct way to go about it?
The proceeds of the sale were then distributed to the beneficiaries, in case that makes any difference.
