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I would really appreciate if experts on this board could help me with this basic question. While calculating Capital Gains do you take into consideration the dates you actually traded (bought and sold)the stocks or the settlement dates for these trades? the settlement date at my brokerage is 3 days out form the trade date. The question arose because I use Microsoft Money to calculate the Capital Gains by entering the Trade dates as I go along-but the Statement from my Brokerage show the Settlement Date as the dates for my buying and selling the stocks. In the end it does not change the time interval I hold the stocks for- but for reporting to the IRS which dates should be put on schedule D?

The other problem I have faced is that if I trade(buy) on a Friday, the settlement date is 5 days out because of the weekend. For the long term Cap Gains if I hold the stock for 1 year and 1 day and sell it(trade) on a weekday,where the settlement date is 3 days out, then the time period for this particular stock may not be 1 year 1 day if settlement dates are taken into account.Can somebody enlighten me on this please.

Thanks in advance

rsyfool
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Welcome rsyfool,
While calculating Capital Gains do you take into consideration the dates you actually traded (bought and sold)the stocks or the settlement dates for these trades?

The trade date is considered the date on which the transaction occurs. Settlement dates represent when payment must be made for a purchase or when assets must be delivered for the sale. For tax purposes, be concerned about the trade date.

An easy way to count the days is to start counting on the date after the day you purchased your shares. For more on this, you might look at the "Tax Strategies FAQ Index" link, located at the top left of the page.

HTH

BmF
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