How do I determine the cost basis for prior year reinvested capital gains of a mutual fund? is it the amount of the capital gain or is it $0?

[RAM2010]

taxes were paid on the capital gains in the year received.

[Anita01 · Accepted solution]

It's the capital gain amount.  Your cost basis always consists of any amount you paid for the stock plus any amount you paid tax on in this or a prior year.  In your case, if the reinvestment of capital gains was the cost of the stock, since you already paid tax on that, youu can now use it as the cost basis.