>>Specifying shares for tax purposes
Dave, I too have heard/read/been advised of many conflicting
opinions on this point. What is unanimous is that a confirmation
reflecting the specific shares OR a delivery certificate
reflecting specific shares delivered is sufficient. On what
is necessary the range has been (1) what the trade confirm
designates (which I have actually been able to get, but only
from full-price brokers), (2) a letter immediately after the
trade designating the shares (keep a copy), and (3) whatever
you determine in your own accounting. There were probably
others.
My personal approach is that if I can't provide the sufficient
documentation (as above) then I send a certified letter
(with return receipt) to the broker on the day following
the trade designating the shares. I don't know how well
this stands up, but there are authorities that say it will.
At LEAST you have documentation (which is essentially the
way the IRS regs read, I think). BTW, the designation should
consist of date(s) of purchase, purchase price(es), and
number(s) of shares.
There is no way you are going to get Datek to respond
to the sufficient conditions, so I would go with the
certified letter if I were you. Nobody'll read the letter,
but at least they have to sign for it <ggg>.
Spots
BTW, The one time I was audited, the agent took the
buy confirms I claimed as the basis without question,
giving empirical evidence for case (3). But I'm such
small potatoes that I don't think it's a good test of
the system. |
