Mutual Fund Cost Basis

Forum|Forum|4 years ago
March 8, 2022
6 replies
32 views

This mutual fund was first opened in 1997 and I need to calculate the "Not Reported to the IRS basis".

I am adding any cash contributions plus from FORM 1099-DIV (1a) Total Ordinary Dividends and (2a) Total Gain Distributions (2a). Everything was reinvested.

My question is: Do I reduce the total by any amounts reported in (7) Foreign Tax Paid?

taxlady28

Level 10

Your basis is the price on the day you purchased. You do not add or adjust the basis.

ErnieS0

Level 15

No. Do not reduce your cost basis by any foreign tax paid.

You are correct in computing your basis in a mutual fund where everything was invested. Your cost basis includes cash contributions plus reinvested dividends and capital gains. You will also have to subtract any return of capital.

See Cost Basis: Tracking Your Tax Basis

**Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"

Thomaston345Author

Level 2

I appreciate your response. As a follow-up question: Why when I compare the amounts from the activity on the yearly statements for dividends/capital gains the total amounts do not equal the 1099-DIV numbers unless I reduced them by the foreign tax paid?

@Thomaston345