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I could see some situations where the IRS position sounds correct to me. Say, one owns 100 shares of IBM in account A purchased on 1-15-01. Then in account B purchases 100 shares of IBM on 4-20-01 and 100 shares on 7-30-01. Then on 10-15-01 sells 100 shares from account B. If the shares are not specifically identified, then FIFO would indicate the sold shares are the 100 purchased 1-15-01 in account A. I see no problem with this.

Now, had account B only had one purchase on 4-20-01 for a total of 100 shares in account B, then I could see where the sale fron account B is a form of specific identification. Here it is clear which shares were sold. By selling from account B all shares of IBM, one has identified which were sold. But if selling only part of what is in the account and not identifying which, then FIFO kicks in, and under FIFO the shares from ALL accounts are included.

Anyone agree or disagree?
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