Mutual Fund Cost Basis Calculator

By Stock Research Pro • March 13th, 2011

Mutual fund investors need to understand their cost basis in order to arrive at a capital gain or loss for tax purposes. The calculation for mutual fund cost basis can be somewhat challenging as there are a number of factors that can impact your cost basis over time.


What is a Cost Basis?


Your cost basis is the original dollar amount you paid for a mutual fund share or some other security. Whenever you sell shares of a mutual fund or some other security, you must report the gain or loss for the transaction to the IRS and in order to do this you must be able to calculate your costs for the different shares you have acquired over time (e.g. through re-investment of dividends).

The calculator below was developed to help you determine the cost basis for your mutual fund investments but if you should always check with your mutual fund company or broker as they should be able to provide you with statements to verify your cost basis. This is especially important when you make the decision to sell your mutual fund shares.


The IRS Rules Regarding Mutual Fund Cost Basis


The IRS does provide mutual fund investors with several options regarding the cost basis you report. It may be worthwhile to speak with a financial advisor in order to determine which method will be most advantageous for you.

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The above information is educational and should not be interpreted as financial advice. For advice that is specific to your circumstances, you should consult a financial or tax advisor.

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