schedule D stock question

I have two questions about trading stocks:
1: When you trade in and out of a stock during the year numberous times,
how do you handle it at tax time?
For example, if you made 20 trades, all short term, can you just total up
the basis and the sales and put
it in as one generalized buy and sell, or do you have to enter each and
every one tedious as that may be?

2: If you have 10 buys over 3 years, and sell 6 of them this year, can you
pick wich of the 10 are the
ones you sold, or is it first in first out?

Thanks,
al

> 1: When you trade in and out of a stock during the year numberous times,
> how do you handle it at tax time?

Look at the wash sale rule for one thing.

> 2: If you have 10 buys over 3 years, and sell 6 of them this year, can
> you pick wich of the 10 are the ones you sold, or is it first in first
> out?

As strange as this sounds, I think the fine print of the sale will
actually have some certificate numbers (or some such) which says
whether it is selling the new ones or the old ones. You might want to
research this more, as what I am telling you seems odd to me too
(given the fungibility of shares of stock).

Jim Kingdon laid this down on his screen :
>> 1: When you trade in and out of a stock during the year numberous times,
>> how do you handle it at tax time?
>
> Look at the wash sale rule for one thing.
>
>> 2: If you have 10 buys over 3 years, and sell 6 of them this year, can
>> you pick wich of the 10 are the ones you sold, or is it first in first
>> out?
>
> As strange as this sounds, I think the fine print of the sale will
> actually have some certificate numbers (or some such) which says
> whether it is selling the new ones or the old ones. You might want to
> research this more, as what I am telling you seems odd to me too
> (given the fungibility of shares of stock).


You should do a lot of research!!
I'm sure it is NOT FIFO. You pick which shares you want to sell. Over 3
years some might go up and some might go down. If you want a profit you
sell the ones that went up. If you want a lose you sell the ones that
have gone down.
This might sound strange, but once I sold some stocks at a lose and
paid less in taxes that year which more than made up for the lose I
took on the stock.

"~AlicGinnis~" <> wrote
> 1: When you trade in and out of a stock during the year
> numberous times, how do you handle it at tax time?



See the instructions for Schedule D.



> For example, if you made 20 trades, all short term,
> can you just total up the basis and the sales and put
> it in as one generalized buy and sell, or do you have
> to enter each and every one tedious as that may be?


As weird as it may seem to you, you are supposed to account for each sale on
a separate line on Schedule D and it's overflow schedules.





> 2: If you have 10 buys over 3 years, and sell 6 of them
> this year, can you pick wich of the 10 are the ones you
> sold, or is it first in first out?




You don't get to pick after the fact. Instruct your broker in writing which
shares to sell.




--
Paul A. Thomas, CPA
Athens, Georgia