How do I find a stock's cost basis? (2024)

FAQs

How do I find a stock's cost basis? ›

For stocks and bonds, the cost basis is generally your purchase price for the securities, including reinvested dividends or reinvested capital gains distributions, plus additional costs such as the commission or other fees you paid to complete the transaction.

Take the original investment amount ($10,000) and divide it by the new number of shares you hold (2,000 shares) to arrive at the new per-share cost basis ($10,000/2,000 = $5). Take your previous cost basis per share ($10) and divide it by the split factor of 2:1 ($10.00/2 = $5).

Purchase Records

If you purchased the asset, documents from the original sale are the preferred option for verifying cost basis. This can include any brokerage statements, commission statements or other proof of purchase for securities that you purchased.

Start by adding the net proceeds to the costs in order to find the gross (total) proceeds from the stock issuance. Then, divide the gross proceeds by the number of shares issued to calculate the issue price per share.

In this case, you should refer to the original brokerage statement detailing the purchase of that security or contact your former broker to determine the Date Acquired and Cost Basis (what you paid for the security) and enter it manually into your tax preparation software or onto your Form 8949.

First-in, first-out method (FIFO)

This is the default for all investments other than mutual funds. Method implications: Because asset prices tend to rise over time, using FIFO as your cost basis method will have the oldest shares sold first, and those shares will often have the lowest cost basis.

Some reasons for unknown cost basis include: merger or transfer activity occurred on a fund account and basis was not provided, the fund account was established prior to average cost being calculated on non-covered shares, basis was not provided at the shareholder's request on non-covered shares, or the fund account ...

Typically, when you purchase shares of stock, the cost basis is simply the price you paid for each share. Say you purchased 10 shares of XYZ for $100 per share in a taxable brokerage account. The total cost would be $1,000, and your cost basis for each individual share would be $100.

Can I use average cost basis for stocks? ›

Average Cost

This method of calculating cost basis is permitted for mutual funds only and cannot be used to calculate cost basis for individual securities such as stocks and bonds.

While a broker will still report the cost basis to the investor or taxpayer, it is up to the investor to report this information to the IRS through Schedule D on Form 1040 for any shares sold, whether covered or non-covered.

In the context of an S Corporation, stock basis refers to the financial stake or investment that a shareholder has in the company. It's essentially the measure of a shareholder's economic interest in the corporation.

Market value is the current worth of an asset or security, determined by its supply and demand in the marketplace. Cost basis, on the other hand, is the original price at which you purchased an asset or security.

The simplest way to keep track of your cost basis is to note the amount of dividends on which you're taxed from year to year. By adding those amounts to what you originally paid for shares, you'll accurately reflect your total cost basis for the position.

How do I determine the value of the shares of a publicly traded stock I received in a merger? The initial cost basis would be the stock's price at the time you obtained the shares. So if you had ten shares at $10 per share, your cost basis is $100. If you sell the 10 shares at $11 per share, your capital gain is $10.