Prepare for New Cost Basis Reporting on the 1099 B Form

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New Cost Basis Reporting May Impact Your Capital Gains Tax

By The BIDaWIZ Team on October 25th, 2011 at 6:45 pm

You may have received a notice recently from your financial institution or broker dealer indicating that they will begin reporting the cost basis for all "covered transactions" to both you and the IRS on form 1099-B. This means that any stocks and ETFs purchased this year will include a cost basis which is intended to make it easier for you to calculate your capital gains tax. But, this also means that electing the appropriate type of cost basis method will be so much more important than in the past. The days of coming up with a cost basis out of thin air are over .

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