Hunting Down Your Stock Basis

March 23, 2009
Special Feature

Did your brokerage go belly-up last year and did your account move to another broker? Did you move your account to another broker because you were worried about whether your brokerage would survive the chaos on Wall Street?

Did your brokerage go belly-up last year and did your account move to another broker? Did you move your account to another broker because you were worried about whether your brokerage would survive the chaos on Wall Street? If either of these scenarios is true, you may have a tough time getting cost information to file your income tax return if you sold any stocks last year.

That’s because you need to know how much you paid for the stock, known as your basis, to accurately report any profit or loss. If you’ve stayed with one broker over the years, getting that information is relatively easy, but if your accounts have moved around, your current broker may not have the cost basis on file. Even if you didn’t sell stocks last year, getting a handle on your cost basis is a good idea; you’ll probably need it at some point in the future.

Figuring the cost basis can be complicated, because it’s more than just what you paid for the stock. If the stock has split or you reinvested dividends, your basis on those shares is not the same as the original cost of the stock. One tool that can help is a website called Gainskeeper (www.gainskeeper.com), which can figure out your basis, including splits and dividends. All you need is the stock name or ticker symbol and the date of purchase. Gainskeeper charges a fee for this service, but you may be able to use it free through your brokerage or through a tax preparation software package like TurboTax Premier.