A Lesson in Record-Keeping

[progree]

4. As for the pre-2012 shares, of mutual funds I still own, I entered what I figured into

Last edited Fri Oct 23, 2020, 02:41 PM - Edit history (1)

the cost basis information for my holdings at Schwab, Vanguard, and Fidelity, where I declare what shares I had before they started keeping track and their cost basis. They keep track after that, and if I trust what they are doing, I don't need to do any more tracking or record keeping. (Actually I don't trust what they do, and for good reason, GRR SCHWAB, but that's another story),

On my 1099 for any sales, the cost basis has a little footnote saying that some cost basis information was supplied by the client or words to that effect. So in case of audit, I would still have to prove the cost basis of the pre-2012 shares.

Edited to add: this is why I extensively go over my tax information (prepare spreadsheets and all that) before seeing my tax preparer. And why I don't do H&R Block or any other Speedy-Big-Refunds-Are-Us tax preparers whose business model is to get you in and out as fast as possible (some think that is great, for me, the alarm bells go clang clang clang). And why I go over EVERYTHING on my prepared tax return before signing. And why I extensively read tax minutiae (AAII Journal and Bob Carlson's Retirement Watch for example).

(In the last 2 years, I've been doing TurboTax instead, as my tax preparer of 35 years was getting more and more erratic).