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Overview
As any investor, accountant or tax professional knows, one of the most time-consuming tasks in tax preparation is the Form 1040 Schedule D.
Calculating the gain or loss on an investment in a security (stock, bond, mutual fund, etc.) requires knowing the cost basis. Determining cost basis can take even the most experienced tax preparer hours or even days. Why should this be complicated? After all, if one has the price per share and number of shares purchased, it should be simple.
What was paid for an investment is not necessarily the cost basis. All tax and investment professionals know this, and also know that the risk of being wrong is either over-paying taxes, under-paying taxes, or worse.
Consider this example:
Client bought 100 shares of AT&T in 1983 at a price of $65 per share.
Total investment: $6,500
Client sold 100 shares of AT&T in 2008 at a price of $ 35 per share.
Proceeds of sale: $3,500
It would seem that the client had a loss of $3000. However, due to over 40 corporate events that have impacted the cost basis of the original investment, the client actually had a gain on those 100 sold shares (and the client owns many more shares of various companies, each with its own cost basis allocation, as a result of the original position).
Now imagine that the client described above had been reinvesting dividends every quarter, at varying prices, each of which is a 'tax lot' that has to be accounted for in the cost basis of the 100 sold shares.
The example above is one which has literally taken experienced professionals days to calculate manually.
The IAS Calculator™ simplifies the process of arriving at an accurate adjusted cost basis for any investment position by utilizing the world's best cost basis software and the world's best securities database.
Simply enter a few key pieces of information into the IAS Calculator and it will do all the research, apply all the tax rules, and do all the math, to painlessly render an accurate adjusted cost basis and gain/loss statement… in seconds.
The IAS website also features proprietary Research tools, for those instances when a calculation is not warranted. Find daily stock, bond and mutual fund prices back to 1968, dividends and mutual fund payments back to 1971, full historical records of each company's cost basis events (capital changes), and determine in seconds the relationships between securities that are caused by mergers, acquisitions, spin-offs, distributions, name changes, ticker symbol changes, splits and recapitalizations.
Click on the Products tab for more information on the IAS Calculators and Research tools.
Click on the About Us tab for more information about IAS and its expertise in the area of securities cost basis.
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