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(in the USA)

I just got my 1099-B for stock that was sold last year. Since the company was bought out, all my stock in this company was sold. This stock was originally invested when I was very young and the number of shares has increased over the year via dividend reinvestment, i.e., using the dividends from this stock to turn around and buy more stock. Because of this, the stock has been purchased continuously over the last two decades or so.

I finally got my 1099-B today for the sale of this stock. I was surprised to find that the form gave cost bases only for the stocks that were purchased since the beginning of 2011. All the shares that were bought before 2011 (the vast majority of the shares I had) are included in box 5 on my 1099-B, and no cost basis is given for these shares.

I had no idea that the cost basis for these shares would not be given to me, and I was very young anyway when the majority of these shares were purchased. How can I figure the cost basis for these shares? I don't know if my family (since they managed the stock while I was young) is in possession of the records of these stock sales anymore. Please note that I am asking how to get the information I need to determine a cost basis (how much each of my shares was originally purchased for), not how to calculate the cost basis given this information.

If I cannot determine the cost basis for these shares, what should I do?

These stocks were not purchased through a broker, but rather from the company directly. I believe Wells Fargo acted as a kind of middle man for these transactions. I cannot speak on the exact nature of the initial purchase, because I was only a little kid at the time and have not heard anything specific about the details since.

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  • Can you elaborate on the brokerage and method you used to make the initial purchase?
    – Nosrac
    Commented Mar 14, 2017 at 14:38
  • Have you checked with your brokerage firm to see what historical account records they have for you. Also do you at least know the dates of transactions.
    – Eric Johnson
    Commented Mar 14, 2017 at 15:18
  • @DanielCarson, see edit
    – NeutronStar
    Commented Mar 14, 2017 at 15:21
  • @EricJohnson, see edit
    – NeutronStar
    Commented Mar 14, 2017 at 15:21
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    @Joshua unless you actually hold the share certificate then a broker is involved. Since Wells Fargo issued you the 1099-B they were at least the final broker of record for your account. I would start with them and see what records they have for you.
    – Eric Johnson
    Commented Mar 14, 2017 at 15:45

1 Answer 1

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For every document that the IRS posts, there will be a correlating instructions page.
This would be the instructions for the 1099-B, here. Furthermore, as you will be reporting this on Form 8949, as a substitute for previously used Schedule D; instructions are here.

This article explains that the best course of action is to donate the shares as the cost basis would switch to FMV (fair market value) of the assets today.

But as this did not happen, I would recommend contacting the purchasing company directly. Being a share holder, and by purchasing the shares from the source, the accounting department should still have recorded the date of purchase along with the price sold. It may take effort to prove who you are, but if their accounting records are well documented, this will not be an issue.
If nothing else, claim a 100% capital gain on the entirety of the sale, and pay the tax. That is stated here.

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