I was thinking of employing the following strategy.
I buy, say $5000 of ATTT. It goes up 20% in the first year, to $6000. I sell $5000 worth of it and report a cost-basis of 5000 -- no cap gain. We'll assume it stays up. I hold the remaining until the 18-month minimum has elapses. I sell this for $1000 or so, and report a cost basis of zero, so I pay the long-term rate on the $1000 profit.
Is this comprehensible? Legal? Brilliant?

I buy, say $5000 of ATTT. It goes up 20% in the first year, to $6000. I sell $5000 worth of it and report a cost-basis of 5000

This is where you're off-base. You can't report a cost basis of $5000 when your actual basis is $4167.

Is this comprehensible? Legal? Brilliant?

No -- nope -- and not even.

Phooley in Phoenix

I was thinking of employing the following strategy.
I buy, say $5000 of ATTT. It goes up 20% in the first year, to $6000. I sell $5000 worth
of it and report a cost-basis of 5000 -- no cap gain. We'll assume it stays up. I hold the
remaining until the 18-month minimum has elapses. I sell this for $1000 or so, and report a
cost basis of zero, so I pay the long-term rate on the $1000 profit.
Is this comprehensible? Legal? Brilliant?

None of the above. You sold 5/6 of your $5,000 basis stock for a profit of 5/6 X $1,000 = $833. You then hold 1/6 with a basis of $833. You buy and sell # of shares, not $ value. See IRS publications and schedule D. ed

just curious. thanks

I was thinking of employing the following strategy.
I buy, say $5000 of ATTT. It goes up 20% in the first year, to $6000. I sell $5000 worth of it and report a cost-basis of 5000 -- no
cap gain. We'll assume it stays up. I hold the remaining until the 18-month minimum has elapses. I sell this for $1000 or so, and report
a cost basis of zero, so I pay the long-term rate on the $1000 profit.
Is this comprehensible? Legal? Brilliant?

That's not how things work. Cost basis is determined on a share/fractional share basis, not lot basis.