Active stock traders - how do you track your buys & sells?

[tk149]

I tried setting up a spreadsheet, but things rapidly went awry when I started doing partial sells, or buying more of a stock over time at different prices.

How do you track your stocks?

 

[henryay]

All stock brokers mail you the 1099 form which includes all stocks you have sold in the current tax year.

 

[tk149]

Originally posted by: henryay
All stock brokers mail you the 1099 form which includes all stocks you have sold in the current tax year.

This does not help if I do not sell all of a stock during that year, if I bought at different times. What if I want to choose which basis to use for tax purposes? For example, if I had 100 shares of DELL, (50 x 18 and 50 x 22), and only sold 75.

 

[MysticLlama]

The software that sharebuilder uses for this calc does it based on First In First Out (FIFO)

Basically if you buy 10 shares at $10, 10 at $20, 10 at $30 and you sell 15 of them, you sold them at the buy prices of $10*10 + $20*5 ($200)

You'd have to check the actual tax laws to see if there are different methods you can calculate on, there very well may be.

 

[tk149]

Originally posted by: MysticLlama
The software that sharebuilder uses for this calc does it based on First In First Out (FIFO)

Basically if you buy 10 shares at $10, 10 at $20, 10 at $30 and you sell 15 of them, you sold them at the buy prices of $10*10 + $20*5 ($200)

You'd have to check the actual tax laws to see if there are different methods you can calculate on, there very well may be.

I don't use Sharebuilder, and FIFO does not allow you to choose which buy prices to use.

 

[Miramonti]

How about copying the transactions directly off your montly statements, or importing data from electronic version of them (might need tweaking in Word first if they aren't excel ready.)

My brokerage's reporting system is very good so I rely on their statements, and import them into excel at the end of the year or when needed.

 

[tk149]

Originally posted by: jjsole
How about copying the transactions directly off your montly statements, or importing data from electronic version of them (might need tweaking in Word first if they aren't excel ready.)

My brokerage's reporting system is very good so I rely on their statements, and import them into excel at the end of the year or when needed.

This still doesn't sound like the solution I"m looking for. Can you choose your own basis?

 

[Miramonti]

Originally posted by: tk149

Originally posted by: jjsole
How about copying the transactions directly off your montly statements, or importing data from electronic version of them (might need tweaking in Word first if they aren't excel ready.)

My brokerage's reporting system is very good so I rely on their statements, and import them into excel at the end of the year or when needed.

This still doesn't sound like the solution I"m looking for. Can you choose your own basis?

Basis as in total cost basis? Yes the reports include that column with the commissions already subtracted (as is appropriate).

Otherwise maybe if you explain what went wrong that you mentioned in your first post I'll understand more of what you're looking for to offer better help.

 

[tk149]

Originally posted by: jjsole
Basis as in total cost basis? Yes the reports include that column with the commissions already subtracted (as is appropriate).

Otherwise maybe if you explain what went wrong that you mentioned in your first post I'll understand more of what you're looking for to offer better help.

I guess what I'm looking for is a way, at the end of the year, to decide what basis points to use for my sells, in order to achieve as little profit as possible on my income tax statement. I'm assuming that I'll be realizing significant losses to offset significant realized gains.

Now, if I bought 10 of AMD for $5/share, and sold 10 of AMD for $10/share, then this would be easy.

But what if I buy 5 of IBM for $5/share, later buy 5 of IBM for $10/share, then sold 7 of IBM for $15/share.

If I wanted to minimize my profit on these transactions, I would say I sold 5 of the $10/share stock, and 2 of the $5/share stock, giving me a profit of $30.

If I wanted to maximize my profit on these transactions, I would say I sold 5 of the $5/share stock, and 2 of the $10/share stock, giving me a profit of $60.

My gains/losses from other stocks would help decide which of the above approaches I would want to take.

I haven't been able to come up with a good way to track this information.

This doesn't take into account long-term vs. short-term. Also, I'm assuming that this is legal, so speak up if it isn't! :evil:

 

[Miramonti]

Generally you'd do fifo, first closing transaction matches up with first opening transaction of the position.

However, profits are profits, so if you sell 7 shares and fudge to account for them to close out your more recent higher priced purchases, you would still have 3 remaining shares to close out which eventually must be matched to the remaining 3 lower priced purchases. So either case its a matter of 'pay me now or pay me later' to the irs. If you don't close out all of the shares this year then you simply will have the taxes to pay later whenever you do.

I'm not aware of being able to account for long term vs. short term for different tax treatment unless you are doing this as a business, in which longterm would be subject to capital gains (generally positions held for 30 or more days or so), and short term would simply go into a pool of total gains and total losses, paying taxes on just the net sum. According to the irs, you are a trader if you do this for a business, otherwise are considered an investor if its more of a hobby. If its a hobby, every time you sell shares you pay capital gains on profits regardless of time held. In trades that are losses, you can only write off up to $3k (maybe $5k now?) of losses per year against the gains (but can carry over additional losses at a rate of $3-5k per year for as many years as needed to write off the entire amount.

This part might be relevant to how much profits and losses you want to account for this year vs. next etc. so that you can offset your losses with gains as efficiently as possible.

 

[alrocky]

Funds Curriculum Course 507 Calculating your Cost Basis, Method Three: Specific Shares " Specific shares, the third way to calculate cost basis, is for meticulous investors only. If you've kept careful records of when you bought shares and how much you paid for them, you can ask... to sell specific shares."

Create two (buy and sell) multi-cell columns. Cells for date, shares, and price, etc.

Aug 2, 05 shares, $05/share : Aug 4, 2 shares, $15/share
Aug 3, 05 shares, $10/share : Aug 4, 5 shares, $15/share

------- 10 shares ------------- : ------- 7 shares

Yes, this is crude but is this sorta what you're looking for? Each purchase is called a Tax Lot. Since you only sold 2 of the 5 shares of Tax Lot 1 (Aug 2), you'll need to add at least one more row for TL1.