I’ve had some stocks and a mutual fund which were originally bought from Ameritrade before it was merged with TD and then Schwab.
They show on my Schwab account but the Cost Basis is listed as N/A. I contacted them and they have no record of when they were purchased. I’ve called the mutual fund company and they weren’t able to help either.
I’m not looking to sell the shares just yet, but how would I determine the cost basis if/when I do sell?
If you know the year that you purchased the stock and mutual fund you could use the average price at that time for your cost basis. Possible options depending on your situation include gifting the shares to a child to be sold when they start working if their income is limited. You could gift the shares to a charity. Or you could leave the shares to your heirs to get the step-up basis when your pass.
Thank you for the suggestions.
Is it a common thing for brokerages like Schwab or Ameritrade to lose track of when a stock or fund was purchased?
You could just go to your filing cabinet and find your original paperwork?
I don’t have the original paperwork.
Not an expert but if I had this issue and I would attempt to figure out which year (or maybe month and year) I acquired them and then either take the average price and use that, or I would pick the lowest price and use that. I would document how I arrived at the number. I also would retain the emails or mailings that show that the financial institutions had no history. Picking the average price or lower would probably show that you did your best to calculate the price without trying to cheat.
Do you still have access to your original Ameritrade online account where you purchased the stocks and mutual fund?
I am with Vanguard and have access to the following information. For shares purchased after about 2012 (called covered shares) I see the cost basis information for each lot. For shares purchased before about 2012 (called uncovered shares) the information is limited to the total number of shares purchased and the average cost.
If I still had “the original paperwork” for all my stuff since 1986… well, you know the answer. My house would be on an episode of “Hoarders”.
How do you keep track of your cost basis without the paper records? Have you kept digital records?
Truthfullly, I don’t have any positions persistent for long periods of time in taxable accounts.
The brokerage should have those records, but apparently they don’t keep all of them.
If they’re handling my account and sending 1099-b’s, wouldn’t it be their responsibility to maintain those records?
It doesn’t help with older transactions, but this a why digital statements are great!
I download every financial statement and store them in folders. For my old old transactions, I scanned any paper copies that I had.
It’s so much easier than keeping paper!
I think that downloading/keeping digital copies should be standard advice for anyone who is investing or who has a retirement plan.
When did you purchase your Ameritrade mutual fund and stocks?
This is from FINRA,The Financial Industry Regulatory Authority “There may be situations where a firm isn’t required—or able—to provide a cost basis for a sale, such as if the securities you sold were purchased or transferred from one firm to another prior to reporting requirements established in 2008.” I believe that the regulation was done in 2008 but and started during the2011/2012 time range that I earlier referred to.