How Can You Find the Cost of Stock Purchased a Long Time Ago?

If you own stock, it's important to know the basis in order to calculate the taxable gain or loss if you sell the stock. The basis is generally what you paid for the stock plus the commission. If you acquired the stock by inheritance, the basis would generally be the fair market value on the date of the donor's death. And if you acquired the stock as a gift, your basis depends on whether the fair market value on the date of the gift was more or less than the donor's basis, and whether you have a gain or loss when you sell the stock.

If you purchased stock a long time ago and don't have a record of the purchase price, or if you received stock as a gift or inheritance and don't know the donor's basis or fair market value on the date you received the stock, you will need to do some research.

As indicated by Kimberly Lankford on the Kiplinger website, you may be able to find historical prices of stocks that are publicly traded on exchanges on the Big Charts website. They have records going back to January, 1985. You should print out the quote and keep it with your tax records in case your return is reviewed and the IRS asks you to support the basis you used for calculating the gain or loss.

If you know the brokerage company through which the stock was purchased, they may be able to provide the information. They must keep records for six years and some may go back further. The brokerage firm may charge you a fee for a statement.

You could go to the investor relations page of the company's website. There you may find information on historical prices and stock splits and dividend history. You can also generally find contact information for shareholder services. You could contact them and ask for a statement of stock purchases and reinvested dividends.

If you know the approximate date the stock was purchased, you could go to the library and look up stock quotes in back copies of a newspaper such as The Wall Street Journal. If you inherited the stock and you know the estate administrator, you may be able to get the information on the value of the stock, or a copy of the estate tax return that was filed.

As reported by Christopher O'Leary in Registered Rep, your financial advisor, broker, or bank may have access to a Web-based information service called AccuBasis developed by Depository Trust & Clearing Corp. in a partnership with the software firm NetWorth Services. This service is intended to provide an archive of stock information back to 1925.

For more recent purchases of stock, it should be easier to find out your basis. As indicated by TurboTax, according to a law passed in 2008 brokers are required to track the basis of stocks and mutual fund shares purchased in 2011 and later years and report the basis to investors and the IRS when the securities are sold.

The IRS has an arrangement with certain software companies to import statements from many brokerage firms to help prepare Schedule D for capital gains and losses on stock transactions and keep track of your basis.

Sources:

Big Charts, Market Watch

Christopher O'Leary, The Cost-Basis Headache, Registered Rep

Cost Basis: Tracking Your Tax Basis, TurboTax

Edward Kelleher, AccuBasis is Off and Running, DTCC

Kimberly Lankford, Finding a Stock's Cost Basis, Kiplinger