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I was thinking of employing the following strategy.
I buy, say $5000 of ATTT. It goes up 20% in the first year, to $6000. I sell $5000 worth of it and report a cost-basis of 5000 -- no
cap gain. We'll assume it stays up. I hold the remaining until the 18-month minimum has elapses. I sell this for $1000 or so, and report
a cost basis of zero, so I pay the long-term rate on the $1000 profit.
Is this comprehensible? Legal? Brilliant?

That's not how things work. Cost basis is determined on a share/fractional share basis, not lot basis.
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