Poll: Do you manually track your cost basis?

[LOL!]

Of course we track cost basis ourselves and use MS Money to do so. We don't have that many transactions, so it is really very simple. We've been doing it since the 1980s without any issues. We can also compare to what our brokers tell us for cross validation.

In order to compare the performance of our portfolio to benchmark portfolios, we also enter transactions in tax-advantaged accounts where cost-basis is not important. We do know our XIRR() between any 2 dates very easily.

And if you are gifted shares, I suppose you can enter nowadays cost basis at your broker, but otherwise they would have no way of knowing your cost basis.

 

[FIREd]

I have found the Quicken cost basis to be quite unreliable. It doesn't seem to handle stock splits very well in terms of basis. And the cost basis for my mutual funds are totally messed up once there have been a few reinvested dividends or sells.

I have never had to deal with splits. But it can be a bit tricky when Vanguard converts investor shares to admiral shares as Quicken treats the conversion as a step up in cost basis.

As far as the cost basis of my mutual funds is concerned, I track individual lots in Quicken. I chose the SpecID cost basis method at Vanguard and I do not reinvest dividends automatically so it is quite straight forward. I haven't noticed any discrepancies with the VG data so far.

 

[Lsbcal]

Nice and simple.

When I first had the opportunity to contribute to an IRA I asked my boss, and friend, about IRA's, and he said that he stopped contributing to his IRA as soon as they made it income dependent, as he didn't want to have to track the cost basis for decades to come.

Now that we are in the withdrawal phase we have to keep track of basis in the tIRA's all the way down until there is no money at all in them. (We were never eligible for ROTH's)

I'd still rather fund any IRA or Roth's that are possible to max them out. It seems to me that the tracking of basis is made easier if you use the same tax software (TurboTax in our case) each year.

We have fairly large Roth's now partly because we did aggressive conversion before taking Social Security. This year that strategy will help a lot as we manage our tax situation using more Roth spending.

 

[RE2Boys]

Have always tracked cost basis, usually FIFO but sometimes specific lot. Have my taxable brokerage accounts set up same way to be consistent.
Have used software, first Managing Your Money from about 1985 to 2000, then Microsoft from 2001 to present. I have always relied on my own records.

 

[Alan]

Is this because you made some contributions to tIRA's that were nondeductible? I recall a post by Nords many years ago warning of the paperwork pitfalls, and that was enough to make me cautious to avoid even an inadvertent visit to that world.

Yes on the tIRA contributions. Plus the company converted its after-tax savings plan to a 401k so the 401k had a before-tax basis as well, that rolled over into an IRA when we ER'ed.

 

[Alan]

I'd still rather fund any IRA or Roth's that are possible to max them out. It seems to me that the tracking of basis is made easier if you use the same tax software (TurboTax in our case) each year.

We have fairly large Roth's now partly because we did aggressive conversion before taking Social Security. This year that strategy will help a lot as we manage our tax situation using more Roth spending.

I used TT until I got swayed by the LBYM'ers on this site and tried TaxAct for free, but went back to TT after a couple of years since the free version didn't carry over the previous return or do as good a job on my foreign pension

 

[ERD50]

I have always tracked cost basis manually (spreadsheet) and likely always will. I do not reinvest divs in taxable accounts so fairly simple.

Same here. I have some old stuff that the brokerage might not have the data for. If I'm doing some, I might as well do all for consistency. I do so few taxable transactions, it's very little effort.

-ERD50