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I have heard that there is a rule for selling stocks "first in is the first out." Is this a strategy for investors or a tax law by the IRS?

For example, I buy 100 shares of CSCO in January of 1997 and then buy another 100 shares today. In June of 2000 the shares are up 50% since today and I choose to sell 100 shares. What are my limitations in reporting capital gains to the IRS?
• Can I report the short term gains on 100 shares in the 28% bracket? (pretend it does not split by this time)
• or do I have to report long term gains in the 20% bracket accumulated since Jan 1997.

The point is that the accumulated gains since 1997 would increase my tax burden significantly where the short term gains would be considerably less.

Again my question gets back to, is this a strategy for decreasing my taxes using long term tax rates or is this a rule/law enforced by the IRS?

I know this must have been asked before so any comments or previous posts #'s would be helpful.

Thanks in advance,

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