First you basis ---- irrespective of cost averaging that the broker uses, your cost basis on the Mutual Funds remains at what you paid for these including commissions.
You report your gross sales & sales commissions on form 8949 --- uses part II for long-term and also include check box to show whether basis was reported by broker or not.
You declare the basis from your records. If the IRS wants proof they will ask for underlying records.
Can you use TurboTax to prepare the form 8949 and schedule D ? Absolutely yes -- just have to use the higher functionality versions. My personal favorite is CD/ Downloaded version of TurboTax Home and Business. But you can use some other versions also. I like this one because (1) it covers all situations, (2) everything is on my machine ( for future ref ) and (3) also I can actually see the forms/worksheets being filled out ( in forms mode )
