Notes on Investments and Investment Income:
•When stock is sold, you will usually receive Form 1099-B, Proceeds From Broker and Barter Exchange
Transactions, reporting the proceeds from the sale. However, your statement will not always provide the
cost/basis information necessary to compute gain or loss. If the statement does not contain the
cost/basis information, you must provide it. You may need to contact your broker for questions about
cost/basis and purchase dates of your stock accounts.
•Often, “transfers” of stock or mutual funds within a brokerage account are actually sales of one type of
stock and purchase of another. Even if you did not receive any cash from the transaction, you may have
taxable gain or loss. •If your stock dividends are automatically reinvested, the dividends will be taxable
even though you did not receive any cash. The transaction is treated as if you had received cash and
purchased additional stock. When the stock is sold, the amount reinvested over the years is taken into
account. You may need to contact your broker for questions about the amount of reinvested dividends.
•If you sold property other than stock, your taxable gain or loss will be determined by your cost/basis. The
cost/basis is usually the original purchase price plus improvements (the cost of repairs and maintenance
are not taken into account for cost/basis).