Author Topic: Selling Vanguard mutual funds-- see cost basis before selling?  (Read 1603 times)

jfer_rose

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Selling Vanguard mutual funds-- see cost basis before selling?
« on: December 04, 2020, 08:53:16 AM »
It's December in the first full year that I've been FIRE and I would like to make my first mutual fund sale in my Vanguard account. While I have many years of experience buying, I haven't ever sold before. I'm using the Affordable Care Act for insurance coverage, so I'm hoping to come up pretty close to the number I estimated for my 2020 income as part of my Heathcare.gov application so that I don't end up owing extra money for my health coverage when I file my taxes. I've gone through my account and made a pretty good guess for dividends and interest, so all that is left to account for is what my cost basis will be for whatever funds I sell.

When I log into Vanguard, I can click on an option to see my cost basis, however it's not showing any data for VTSAX. Is there a way for me to see what my cost basis will be before I sell? [I just upgraded my account to brokerage yesterday, could this be why I can't see my cost basis?]

Thanks for any insights!

seattlecyclone

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #1 on: December 04, 2020, 09:38:55 AM »
How long have you owned these particular shares? If you bought them before 2011 then Vanguard isn't required to track the basis.

jfer_rose

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #2 on: December 04, 2020, 09:55:57 AM »
How long have you owned these particular shares? If you bought them before 2011 then Vanguard isn't required to track the basis.

I opened my Vanguard account in 2013, so that's not an issue.

erutio

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #3 on: December 04, 2020, 10:26:18 AM »
Do you have SpecificID selected as your cost basis method?

If you have that selected, when you choose to sell, you can click and choose which little lots of VTSAX you want to sell.  If you have been automatically investing monthly or weekly, you may have over 100 different cost bases to choose from.  They will also differentiate your shares between short term and long term gains.

erutio

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #4 on: December 04, 2020, 10:27:09 AM »
You can also click on the drop down arrow below each of your holdings on the Vanguard site to see your cost basis for your shares.

jfer_rose

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #5 on: December 04, 2020, 11:23:48 AM »
Well the first issue is likely that having never sold, I hadn't set a cost basis method yet. I picked average because it seems the simplest to me, however I am able to change this.

But even with that now completed I'm still not seeing my cost basis for any but one fund (the one I can see has very little money in it). I might try again in a few days in case the recent upgrade to a brokerage account is causing a delay in my being able to see this.

bmjohnson35

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #6 on: December 04, 2020, 02:12:55 PM »

Have you tried calling Vanguard and asking them to walk you through the process?  I called them recently to find out how to review my capital gains YTD and they were very helpful.

erutio

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #7 on: December 04, 2020, 02:31:01 PM »
Well the first issue is likely that having never sold, I hadn't set a cost basis method yet. I picked average because it seems the simplest to me, however I am able to change this.

But even with that now completed I'm still not seeing my cost basis for any but one fund (the one I can see has very little money in it). I might try again in a few days in case the recent upgrade to a brokerage account is causing a delay in my being able to see this.

Yup, I think this is the issue.  SpecificID is the way to go.  After your account updates in a few days, you should be able to see the cost basis of each lot of shares you bought over the years.

jfer_rose

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #8 on: December 04, 2020, 03:16:22 PM »
Well the first issue is likely that having never sold, I hadn't set a cost basis method yet. I picked average because it seems the simplest to me, however I am able to change this.

But even with that now completed I'm still not seeing my cost basis for any but one fund (the one I can see has very little money in it). I might try again in a few days in case the recent upgrade to a brokerage account is causing a delay in my being able to see this.

Yup, I think this is the issue.  SpecificID is the way to go.  After your account updates in a few days, you should be able to see the cost basis of each lot of shares you bought over the years.

Can you tell me more about why Specific ID is the way to go? Thanks!

erutio

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #9 on: December 04, 2020, 04:08:28 PM »
You can pick and choose which shares to sell, thereby picking the cost basis you want to sell at.

2sk22

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #10 on: December 05, 2020, 02:28:20 AM »
How long have you owned these particular shares? If you bought them before 2011 then Vanguard isn't required to track the basis.

Interesting - my accounts are on Fidelity and I just checked that the have the cost basis of every share purchase since I opened my account in the mid 90s!

seattlecyclone

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #11 on: December 05, 2020, 10:17:14 AM »
How long have you owned these particular shares? If you bought them before 2011 then Vanguard isn't required to track the basis.

Interesting - my accounts are on Fidelity and I just checked that the have the cost basis of every share purchase since I opened my account in the mid 90s!

Sure. Nothing was ever stopping them from tracking that as a courtesy to you. They weren't (and still aren't) required to report the basis of those old shares to the IRS when you sell them.

2sk22

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Re: Selling Vanguard mutual funds-- see cost basis before selling?
« Reply #12 on: December 06, 2020, 03:40:11 AM »
How long have you owned these particular shares? If you bought them before 2011 then Vanguard isn't required to track the basis.

Interesting - my accounts are on Fidelity and I just checked that the have the cost basis of every share purchase since I opened my account in the mid 90s!

Sure. Nothing was ever stopping them from tracking that as a courtesy to you. They weren't (and still aren't) required to report the basis of those old shares to the IRS when you sell them.

I took a second look a bit more carefully and you are right about them not being obliged to record cost basis. This is what it says:

Quote
UNREPORTED
Brokers are required to report adjusted basis for mutual fund shares purchased after 1/1/2012 to the IRS on Form 1099-B.Fidelity has computed a separate average for fund shares that will be reported and a separate average for fund shares that will not be reported.

This is definitely relevant to all long-term buy and hold investors like FIRE people. Its just as well that I am a bit of a pack rat and have all of the transaction receipts from the mid 90s!