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I've sold several stocks this year. I'm trying to figure out my cost basis. These stocks were held in a dividend reinvestment account. What's the formula?
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The basis is your original investment of $y for z shares plus the total number of shares purchased by the dividends. Assuming you have had these DRIP accounts for some time, the dividends reinvested would be divided into 2 groups - short term and long term.
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<< I've sold several stocks this year. I'm trying to figure out my cost basis. These stocks were held in a dividend reinvestment account. What's the formula? >>

If you sold all your shares of a company, simply add up everything you invested, including the reinvested dividends, and separate into short- and long-term.

If you sold only a part of your holding, you sold the oldest shares first. Start with your initial investment, adding purchases (including reinvested dividends) until you get to the number sold, separate into short-and long-term if necessary, and there's your basis.

Phil Marti
Tax Preparer
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