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I apologize if the following question has been asked several times but this is quite new to me...in an hypothetical scenario...If I bought 100 shares of company X on 11/1/2008 and later on bought 100 more on 6/1/2009, then sell 100 at a profit on 12/1/2009, how do I calculate taxes on this transaction? is it long-term capital gain or short term capital gain?

thank you very much
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Yes. It is either a long-term or short-term capital gain, it's up to you to decide which "lots" you sold. Hopefully, your brokerage account allows you to indicate such when you sell. If not, keep good records.
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is it long-term capital gain or short term capital gain?

If you did not specifically notify your broker that you were selling the 6/1/2009 lot AND your trade confirmation reported it as such ... it would be a long term gain because IRS works on a [FIFO basis] First in First out.

Best Regards,

Rich
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It is either a long-term or short-term capital gain, it's up to you to decide which "lots" you sold.

This is incorrect. Unless you specify and get confirmation at the time of sale, it's FIFO. See Pub 550.

Phil
Rule Your Retirement Home Fool
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