Here are the key tax rules that come into play when selling shares of stock.
Basics of Stock Investing
If you’ve never had a brokerage account but want to begin investing in stocks, here’s a primer.
Trade Date and Settlement Date
Stock transactions occur in two steps, a trade date followed by a settlement date. Here’s how they differ, and the significance of each for tax purposes.
Last Day to Sell
When making stock sales near the end of the year, you need to be aware of the deadline for having the results appear in the current year’s tax return.
Multiple Lots of Shares
Some of your shares may have basis or holding period that differs from other shares you hold in the same stock. Here’s why this is important.
FIFO: First-In, First-Out
This is the default rule for determining which shares you dispose of when selling part of your holdings in a particular company.
How to Identify Shares
Sometimes you get better results if you identify shares instead of relying on the default FIFO rule.
Cash Received in Mergers
You may receive cash as part of the deal when you hold stock in a company that’s acquired by another one.
The Wash Sale Rule
When you sell stock at a loss, this rule can prevent you from claiming a deduction if you buy replacement shares shortly before or after the sale.
Stock Basis and Holding Period
These pages explain how various methods of acquiring stock may affect its basis and holding period.
Selling Mutual Fund Shares
Some of the rules here differ from rules for selling shares of stock.