Stock basis calculation software (nightmare...)

[Delawaredave5]

I'm helping a person who has a nightmare of back tax filings, poor documentation, and tons of trades.

Question: is there any software you've found helpful for stock basis, gain/loss calculations ?

Looking for something where I can post all the transactions and hopefully the software "make sense of it".

I know value of CPA and I will be getting end product reviewed by one - but this person is broke and we gotta "DIY" most of this.

Thanks !

 

[LOL!]

Certainly MS Money can do this. You enter all the transactions and create reports. You can download a free trial to use. Intuit Quicken does the same. You can also create an Excel spreadsheet to help.

Also even with TurboTax you have to enter the trades and it will calculate gains/losses.

I use MSMoney and some Excel for special situations (buyouts, company splitting into 2 or 3 companies with new stock ticker symbols).

Unfortunately, unless you stay on top of it, you sometimes can't remember what you did. For example, I give away stock to charity. Years later, I need to remember/find/document which lot I gave away, so I have to go find my 'letter of instruction" or look at my old tax returns. Nevertheless, it's just busy work if you have a record of all your transactions which are usually found in the annual-statements.

 

[Delawaredave5]

Certainly MS Money can do this. You enter all the transactions and create reports. You can download a free trial to use. Intuit Quicken does the same. You can also create an Excel spreadsheet to help.

Also even with TurboTax you have to enter the trades and it will calculate gains/losses.

I use MSMoney and some Excel for special situations (buyouts, company splitting into 2 or 3 companies with new stock ticker symbols).

Thanks for post - I have Turbotax and Quicken.

Will these softwares handle the "specific shares sold" decisions ? There's hundreds of trades. There's a bunch of "buy 100, sell 25 later, then buy 150 more, then sell 80, etc" trades in same stock.

I don't understand rules around "average costing", specific share, LIFO, FIFO ,etc.

Thanks !

 

[lucija]

I realize I am probably not helping at all, but it is important to know... Has this person previously sold any of this stock/MF?

If so, he/she is already locked in whatever cost-basis mechanism they used at that time. You will not be able to switch between ways of computing cost basis unless you get specific permission by IRS.

 

[kaneohe]

here's some info on switching cost-basis methods.....looks like once you switch to averaging you're locked in, but otherwise you can do switching
Fairmark Forum :: Capital Gains and Losses :: Reverting mutual fund from average basis to cost basis

 

[LOL!]

Thanks for post - I have Turbotax and Quicken.

Will these softwares handle the "specific shares sold" decisions ? There's hundreds of trades. There's a bunch of "buy 100, sell 25 later, then buy 150 more, then sell 80, etc" trades in same stock.

I don't understand rules around "average costing", specific share, LIFO, FIFO ,etc.

Thanks !

Yes, they will handle specific shares sold ... but that decision had to be made when sold and documented at that time. For stocks, the rule is FIFO unless you use specific share identification which some online trading platforms do not support. "Average cost" is a mutual fund thing and I would not use it myself (I would use FIFO), but some folks like it because their mutual fund company will tell them the average cost, but there is no way to really know if the fund company did the calculation correctly.

So I think I've just simplified everything for you because with stocks there is no LIFO and no average cost basis. You have only FIFO or specific lot identification. And if the records are a mess, there was probably no specific lot identification going on (other than wishful thinking). That leaves you with FIFO. Simple.

 

[mark500]

I had to purchase some software for 2008 taxes and ended up picking this one. It's pretty good.

Portfolio Management Software - Fund Manager