Do ordinary cash dividends affect stock cost basis ?

  • Thread starter Audy [John 6:54]
  • Start date

A

Audy [John 6:54]

Can anyone tell me if after holding a stock for a couple of quarters and
receiving ordinary cash dividends to what extent if any does it affect the
figuring of the stock cost basis. For instance...

Stock ABC bought at $10718.00

and I received ordinary dividends on two separate occasions for $50.00 where
these ordinary dividends are reported on a 1099-DIV

thanks,
(e-mail address removed)
 
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P

Paul A Thomas

Audy said:
Can anyone tell me if after holding a stock for a couple of quarters and
receiving ordinary cash dividends to what extent if any does it affect the
figuring of the stock cost basis. For instance...

Stock ABC bought at $10718.00

and I received ordinary dividends on two separate occasions for $50.00
where
these ordinary dividends are reported on a 1099-DIV


If you received the dividends, as in they cut you a check, then there is NO
impact to your cost basis.

If the dividends were reinvested, then that is treated as a purchase, and
your cost basis for the entire holding changes, as you purchased some more
shares.
 

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