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Get a head start on basis reporting to minimize taxable gain

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in Small Business Tax Deduction Strategies

Don’t forget that this is the first year that new “basis reporting” rules take effect for securities sales. In some ways, things will be easier for you. You won’t have to search through your records to find the basis of certain investments.

On the other hand, you may discover you’ll have to pay more tax than you initially envisioned.  

Strategy: Be proactive. By planning ahead, you may be able to minimize the taxable gain on a securities sale or increase the tax-deductible loss.

Under IRS regulations issued last year, the onus is still on you to identify shares of securities you intend to sell.

Here’s the whole story: When you sell securities, you may have a taxable gain or loss based on the difference between the sales prices and your basis. Your “basis” is usually the acquisition cost plus certain adjustments such as broker commissions. Also, basis must be adjusted for events like stock splits and mergers.

The resulting ca...(register to read more)

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