This information that is known as the stock cost basis is required by the United
States Internal Revenue Service to determine the amount of tax that is
owed on
your stock options. This information is used to determine how much
income you
made or lost from the sale of your stock. The stock cost basis might be
difficult or easy to figure depending upon the changes that have
happened to
the companies whose stock you own.
If
the stock was purchased by you, then the stock cost basis is the amount
of
money you spent to buy the stocks. If you don't remember what you paid
for your
stocks, you can ask your stockbroker you should have that information
available. Any reputable brokerage firm will keep records for six to
eight
years. You can contact your broker to see how much you paid for the
stock or
your stock cost basis so you can determine your tax basis for the
Internal
Revenue Service.
However
if you bought your stocks before this time period of six to eight
years, then
you must actively try to discover what the stock cost basis was that
you paid. Suggestions
to help you discover your stock cost basis include the use of old stock
certificates
that you might still have in your possession. Also if you have had
these stocks
for a lot of years, you must have had to declare them on a tax form
before, so
you can check old income tax filings that you completed.
If
the stock has been received by you due to a relative's death in the
family,
then the stock cost basis would be what the stock price was at the time
of the
person's death. You can find this information by contacting the
stockbroker of
the relative or by using the financial section of the local newspaper's
archives for a list of stock quotes.
If
you were given the stock, then calculating your stock cost basis would
then
depend on the market value of the stock when it was given to you. You
would
then determine your tax basis depending if you had a loss or gain when
you
resell the stock.
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