Tax Law (Questions About Taxes)/mutual fund cost


Hi,I need your help!
How does the dividend and capital gain (taxes on which had been paid) of a mutual fund affect the cost basis?
For example, I had accumulated 100 shares of a mutual fund (dividend and capital gain reinvested) over 3 years and sold 50 shares. The mutual fund company sent me a cost basis (average cost) of $500. The dividend and capital gain of the 100 shares over the 3 years are $100 which I have paid taxes on my tax return. Is the cost basis equal to $500+$100/2= $550?

Best regards!


you dont say what you paid for the 100 shares "accumulated"

but yes, the purchase price plus dividends reivnested is your new total basis.  call the brokerage fund and ask for an analysis/calculation of their determination.

i agree that if you paid 1000 for all 100 shares, the basis would be 1000 plus 100 divided by 2

but i am guessing you missed something.  the likelihood that fidelity (or vanguard or trowe, etc) is wrong is pretty slim!  

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Tax and general business including hospitality related (hotel mgmt degree and experience in industry prior to obtaining ms tax and cpa).


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