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Strategies & Market Trends : Income Taxes and Record Keeping ( tax ) -- Ignore unavailable to you. Want to Upgrade?

To: Colin Cody who wrote (1570)	12/8/1998 9:01:00 PM
From: Investor2	Respond to of 5810

Hi Colin. Consider this problem: - Stock was purchased over a number of years through reinvestment of dividends and optional cash payments into a dividend reinvestment plan. - A portion of the stock was sold two or three years ago. At that time, the cost basis and capital gains were calculated using the "average cost" method often used for mutual funds. As I understand it, this method is not allowed for individual stocks. - The remaining portion of the stock has not been sold to date. Questions: 1. Am I correct that the "average cost" method is not allowed for determining capital gains for individual stocks? 2. What options are available to the taxpayer? 3. What, in your opinion, should the taxpayer do? Best wishes, I2