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I posed the question to e.Schwab and here is there rather lengthy answer. It took two tries.

<<Dear Mr. Stanley:

Thank you for your e-mail.

We sincerely apologize for not responding to your mail item within 24 hours. Certain volume peaks have made this goal an elusive and sometimes unobtainable one.

The lot designation of shares sold on trade confirmations is no longer required by the Internal Revenue Service. You may use the e.Schwab software to designate the shares sold, by matching tax lots for the position, after the trade executes. I will not bore you with the same information regarding how to do this. (This information has been provided in our previous e-mail). For additional information, please refer to pp. 77-80 of your e.Schwab User Guide.
If you still desire to have the shares designated on the confirmation notice, then you must contact e.Schwab Customer Service at 1-800-362-6789 after you place your order in your account but absolutely no later than the close of market on the day the trade is executed. Your call, however, will be subject to the standard e.Schwab telephone call fee if it is not your free call for that month.

In regards to the issue of what methods are accepted by the IRS. Schwab cannot act as a tax specialist. We can however, tell you that once a method is chosen (say for instance, First in First Out) that it is generally expected that this is the method you will use throughout your Portfolio. For more information on this, you will need to contact a qualified tax specialist.

In response to your query, we regret that you will not be able to use any of Schwab's electronic trading products to place the type of trade to which you were referring. We regret if you were misinformed about this. Our electronic trading products do not have the capability to determine which shares of a particular holding are being sold. A live broker must place this type of trade.

If you have a standard Schwab account, please call 1-800-435-4000.

If you wish to place this trade in your e.Schwab account, it still must be done via a live broker. This means that the trade will be subject to the regular Schwab commission (rather than the $29.95 electronic commission), and the call may be subject to a $5 charge. Please call 1-800-362-6789.

We hope this clarifies the issue, and we regret any inconvenience you may experience

If you have any further questions or concerns, please do not hesitate to contact us. Thank you for using Schwab's Electronic Brokerage Services.

Have a good evening.

Sincerely,

Laura Gonzales
Schwab Electronic Brokerage Services


-- Original EMail Message, Contact #64539 --
[OrigSubject: RE: Message to Schwab]

I posed the following question to e.Schwab about Specific Identification of shares.
<<Date: September 18, 1997

Gentlemen:

How does one stipulate through e.Schwab which block of shares to sell ( Specific Identification)? Will this information show up on the confirmation or the statement?

Bill Stanley>>

I'm sorry but I do not believe you answered the question. Will the Specific Identification of the block of shares show up on the conformation? Will the Specific Identification show up on the statement? This question has nothing to do with you keeping up with gains or losses.

<<It is the responsibility of the customer to match the purchase and sale of a security in their account by a method approved by the IRS.>>

Now that you have brought up the issue of 'method approved by the IRS'. What is the approved method of accounting for Specific Identification that will pass IRS audit. Since you represent e.Schwab to 750,000 e.Schwab customers you should certainly be in the know.

These are not frivolous questions.

<<The Match Tax Lots feature in your Schwab Trading application allows you to designate which shares you wish to sell>>

One of us has not may not have read the application closely enough. Please advise the page and approximate location of the information to which you refer.

Thanks.

Bill Stanley
>>
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