The Motley Fool Discussion Boards

Previous Page

Financial Planning / Tax Strategies

URL:  http://boards.fool.com/i-buy-a-lot-of-stocksoptions-that-i-average-in-10553951.aspx

Subject:  Re: Averaging out of Stocks Date:  1/27/1999  2:16 PM
Author:  TaxService Number:  9066 of 121106

I buy a lot of stocks/options that I average in and out of: Meaning I buy 500 shares of Dell on two different dats and then sell 400 on day 1, 400 on Day 2 and 200 on Day 3. I use TurboTax. Do I determine what shares I sell or is there an IRS rule telling me what shares I have to sell 1st, 2nd and 3rd?

Also, how do you allocate the commissions on these types of sales? Do you just divide it by 3?

Here's an example:

I buy 500 sh. Dell @ $50 and 500 @$100. I sell 600 @ $200 in 1998. Do I get to choose which shares I sold? (I want to sell 500 of the ones I bot at $100 and 100 of the ones I bot @ $50). Do I use 2 different lines on my Sch. D? How do I split the commissions?

***You can buy and sell, in any order, as long as you specify which ones you are selling. Each sale is reported, individually (in the short term or long term sections) on Schedule D (Form 1040) or your own schedule, and attached to your tax return with the required information. If you have losses applicable to wash sales (sold within 30 days before or after new purchase of same stock), special rules apply.

"Jack"
Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us