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Find tax ID for securities sales

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in Small Business Tax,Small Business Tax Deduction Strategies

One tax law crackdown on investors was removed from the final version of the new tax reform law. It would have affected sales of investors who own multiple blocks of stock and mutual fund shares that were acquired on different dates.

Strategy: Specifically identify the block of shares from which you want to sell by reference to the acquisition date and per-share price. Otherwise, the IRS will use the default method to determine the taxable gain or loss. This could increase your tax bill.

By using the specific ID method, you may be able turn a tax gain into a more beneficial tax loss. This technique would have been wiped out by the proposed tax law change.

Here’s the whole story: When you sell securities, the taxable capital gain or loss is based on the difference between the sales prices and your basis. The “basis” for this purpose is usually the acquisition cost plus certain adjustments such as broker commissions. ...(register to read more)

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