Cost basis and commission
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Cost basis and commission The IRS does not determine cost basis. The broker reports it based on tax law. They do not always do it correctly so there is a column on IRS Form 8949 for adjustments when necessary. Cost is the price of buying stock including commissions and fees. Sales price is usually reported as the net amount you receive which is gross minus commissions. Sometimes the broker may report just the gross, in which case you would add the commission to the cost basis. Wash sales can affect losses. For those that pay advisory fees in lieu of paying commissions, my condolences. Those fees do not reduce gains. They are a miscellaneous deduction on Schedule A and few people benefit from that for a variety of reasons, but mostly due to The AMT in high tax states. Linda Tax preparer Sent via the Samsung GALAXY S(R)4, an AT&T 4G LTE smartphone -------- Original message -------- From: Tim Hoyman <tim@timhoyman.com> Date:04/16/2015 10:24 PM (GMT-05:00) To: club_cafe@bivio.com Cc: Subject: [club_cafe] Cost basis and commission basis with the brokerage commission when buying and selling stocks. Is the commission amount part of the cost basis when you buy a stock, and when you sell is the commission deducted from any capital gain? Thanks for the response. Tim Hoyman, Treasurer, Colorado Leprechauns. See correction for clarity in CAPS below. Ira Smilovitz On Fri, Apr 17, 2015 at 12:51 AM, Linda <wiltse@optonline.net> wrote:
Thanks for the response. I thought this was the case but wanted to make sure. Tim Hoyman The Mozart of Real Estate 303-669-2676 CONFIDENTIALITY NOTICE: This email message and any attached files contain confidential information intended only for the person(s) to whom the transmission is addressed. If you receive this message and you are not the addressee, do not read the message or any attached files. Any unauthorized use, disclosure, copying or distribution is strictly prohibited, and no rights are waived. If you are not the person(s) to whom the message is addressed, please return the email to the sender by sending an email reply, and delete the message from your computer system. Please also contact the sender at The Denver 100, LLC, 385 Inverness Pkwy, Suite 270, Englewood, CO 80112, 303-669-2676. Thank you. From: club_cafe@bivio.com [mailto:club_cafe@bivio.com] On Behalf Of ira smilovitz See correction for clarity in CAPS below. Ira Smilovitz On Fri, Apr 17, 2015 at 12:51 AM, Linda <wiltse@optonline.net> wrote: The IRS does not determine cost basis. The broker reports it based on tax law. They do not always do it correctly so there is a column on IRS Form 8949 for adjustments when necessary. Cost is the price of buying stock including commissions and fees. Sales price is usually reported as the net amount you receive which is gross minus commissions. Sometimes the broker may report just the gross SALES PROCEEDS, in which case you would add the commission to the cost basis. Wash sales can affect losses. For those that pay advisory fees in lieu of paying commissions, my condolences. Those fees do not reduce gains. They are a miscellaneous deduction on Schedule A and few people benefit from that for a variety of reasons, but mostly due to The AMT in high tax states. Linda Tax preparer Sent via the Samsung GALAXY S(R)4, an AT&T 4G LTE smartphone -------- Original message -------- From: Tim Hoyman <tim@timhoyman.com> Date:04/16/2015 10:24 PM (GMT-05:00) Cc: Subject: [club_cafe] Cost basis and commission I am just wondering how Bivio and the IRS determines cost |
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