Stock selling question?

Question

if i buy 100 shares of company X on jan 1st 2007 then i buy 100 shares again today... if it goes way up in a week and i sell just 100 shares, does that count as holding the stock for more than a year or less than a year. i wonder this for tax reasons. thanks.

Answer 1

The IRS considers FIFO.  First in, first out.

You would designate the shares bought on Jan 1, 2007 as those sold first.   It would be a long term CG.

Answer 2

If you have a loss, you have an issue called a wash-sale- since I don't think that is really your question.

Yes you can treat it as long-term.

The cleanest way to do it is to ask your broker to apply specific lot identification, so that it will be reflected in your records. Otherwise you will need to keep track of it separatately

The IRS does NOT REQUIRE FIFO -but it is often assumed in records

Answer 3

Each "lot" of shares purchased on a particular date, in this case 100 shares, are sold individually. If you have a preference of which 100 of your 200 shares to sell, you need to inform the broker. If you buy 100 shares on June 18 and sell them a week later at a profit, that is a "short term" gain, even though you bought another 100 shares a year ago.  If you specify shares bought more than a year ago to sell now, and still make a profit, that would be a "long term" gain.

Answer 4

yes, but make sure you sell the original 100 shares.  not the short term ones.  make sure to tell your broker specifically this so he makes a note of it.