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Author: RickZ5 CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121219  
Subject: Re: Dividend Reinvestment - A Tax Nightmare? Date: 7/7/2008 11:19 AM
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What you'll need to do is set up a spreadsheet - manual or computerized - with the following columns: date, number of shares, dollars.

Here is what I have done with my stock. There have been no dividends yet, but I am making a monthly deposit of $135, which I will treat exactly like dividends, right?

DATE	SHARES	COST DOLLARS	DATE SOLD	SHARES SOLD	SALE DOLLARS	GAIN/LOSS
6/17/08 15.0130 $1,000.00
7/1/08 2.0642 $135.00


Now, lets say I decide to sell 10 shares. It would look like this now, right?


DATE SHARES COST DOLLARS DATE SOLD SHARES SOLD SALE DOLLARS GAIN/LOSS
6/17/08 15.0130 $1,000.00 7/7/08 10 $664.00 $336.00
7/1/08 2.0642 $135.00


And then, if I wanted to sell 6 more shares, I would first sell the rest of the shares from the first lot (the remaining 5.0130) and then would take the rest from the second lot, right?

When we need a price per share, we'll do the division to get it. Most of the time you won't need it.

How would I do this calculation?


I am a very good record keeper... a bit compulsive and obsessive so I think I should be able to keep track and in a weird sort of way enjoy it. But I want to make sure I START doing it correctly!

Does my setup look correct? Any other observations?

Finally, so now when I sell shares from a lot that has been bought over a year ago, those sales will be long term capital gains, right?


Thanks so much!
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