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Author: sseth One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 120807  
Subject: specifying stocks. I think I goofed up! Date: 2/15/2000 8:04 PM
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Hello everybody. I need help from people who are familiar with the Employee Stock Purchase Plan (ESPP).

I am in a quandry. While selling stocks from my ESPP, I forgot to mention which lot I was selling. I will describe my situation and then I would like to know if there is an out.

I recieved lot 1 for the period Jan 1 98 - Jun 30 98.
I recieved lot 2 for the period Jul 1 98 - Dec 31 98.

I sent in certificates for both these lots at the same time to my brokerage in Jan '99. I have not deposited any more shares (I am holding certificates for the later lots with me)

In march '99, I sold some of the shares without specifying which lot I was selling from. This will not be important for my 99 taxes as in either case, I am looking at short term gains.

However, the shares that remain in the brokerage are important. The shares have appreciated significantly and if I sell them now I will have a big gain. If I can specify the remaining shares to be of lot 1, then I can claim long term gains (2 years from beginning of period). However, If I am forced to claim them to be of lot 2, I do not get into long term territory till July 2000, by which time the value may decline.

Now here's the question:

Since I had the certificates and sent them in at the same time, can I simply claim that the sold shares belonged to lot 2? Or will this upset the IRS? I can provide the certificate number to the IRS if needed.

The worst thing is that not only do I feel like a doofus for selling too early (about $20,000 too early), but I'll have to pay higher taxes as well!

Thanks in advance for your help,

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