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Old 02-15-2015, 08:33 PM
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No Purchase Date for Stocks

My husband was gifted stocks from his grandfather many years ago and we cashed out this year. We have no idea when they were purchased, his grandfather passed away and we have no information on the purchase date. How do we figure cost basis?



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Old 02-16-2015, 01:22 AM
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My husband was gifted stocks from his grandfather many years ago and we cashed out this year. We have no idea when they were purchased, his grandfather passed away and we have no information on the purchase date. How do we figure cost basis?=======>>>>>>>>>>>>>>as you don't have paperwork, then you'll have to take a few more steps to track down the cost. A stock certificate might be dated or his gf’s old tax returns might show . Then look up historical price quotes. If you can narrow down the purchase period to a few months, use the average price during that time as your basis and keep records of your methodology. You may also find some helpful information at the investor relations page on the company’s Web site. PG&E’s site has a ton of good resources, including stock split and dividend history going back to 1912 and historical price going back to 1980. The site also has the contact information for the shareholder services department, which might be able to answer your questions about the share price before 1980.
When you receive a gift of stocks
or mutual funds etc, your cost basis
is the same as the donor's cost basis
except when it's not!
It all depends on whether the
donor's cost basis
was more or
less than the fair market value
of the stock on the date of the gift.

The donor is the person who gave the
stock to you, his gradpa; Your husband is the donee,
the person receiving the gift of stock.





If the carryover basis is less than the
fair market value at the time of the
gift, the answer is easy. Your cost basis
is always the carryover basis

If the carryover basis is greater than the
fair market value at the time of the gift,
it gets a lot more complicated. You
will actually not know your basis until
you sell the stock because it will have
a different basis if it is sold at a gain
than if it is sold at a loss.





If the stock you received as a gift is then sold at a loss, your cost basis is the
lower of either the carryover basis or the fair market value at the time of the
gift.

If the stock you received as a gift is then sold at a gain, your cost basis is the
carryover basis from the donor.

In some situations, you will end up not having a gain OR a loss when you sell the
stock! It happens when the sales proceeds are more than the
cost basis for a loss (i.e. lower of carryover basis or market) but less than the cost
basis for a gain (i.e. carryover basis.). in this case no gain or loss on stock sale



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