4

I realized the calculation may be a bit complex to do manually, specially when you buy/sell several times during the year at different prices, set dividend to "reinvest", etc. They should be able to calculate it easily using software. Is such help typically given by brokers/fund manager (e.g. in some report)?

2

Starting of 2011, US brokers are required to report cost basis for every sale of stocks (purchased after the starting date, 01/01/2011). For mutual funds the requirement kicked in on 01/01/2013, I believe. So for positions opened after that date - you'll have the cost basis reported on the 1099-B you'll get from the broker.

For earlier positions, or positions not opened through a (US) broker, you're on your own.

  • Some mutual fund brokers (such as Vanguard) will also report your basis on purchases from before these requirements went into effect, but the accuracy of those numbers is your responsibility (not your broker's). That being said, I just use my broker's numbers because the cost to me of verifying the basis from weekly automated investments in multiple funds for the past 20 years is so much greater than the cost of any potential IRS audit on those numbers would be. – dg99 Jul 7 '14 at 21:44

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