Tag Archives: Cost Basis Reporting

FPPad Bits and Bytes for December 17

Posted on December 17, 2010 by in Bits & Bytes

FPPad headquarters has temporarily relocated to the mid-Atlantic area for the holidays. Our official consulting work for 2010 is complete, and we look forward to serving new and existing clients in 2011.

We are also happy to provide insight directly on this blog and to our subscribers. Yes, individual posts have been a bit more sporadic, but we continue to aggregate the best in technology-related articles from around the web each week in Bits and Bytes.

With new laws taking effect January 1, 2011, cost basis reporting requirements dominate this week’s update. Here are this week’s stories of interest:

Fidelity® Provides In-Depth Analysis Of Finalized IRS Cost-Basis Reporting Requirements at Fidelity.com

Fidelity Investments®, a leading provider of trading, custody and brokerage services to registered investment advisors and broker-dealers, today announced that it has introduced a new report designed to help its clients understand differences between the proposed cost-basis reporting requirements and those recently finalized by the Internal Revenue Service.

Charles Schwab Advisor Services Cost Basis Legislation Resources at Schwabadvisorcenter.com

The Emergency Economic Stabilization Act of 2008 included new tax reporting requirements that will dramatically change the way investors and financial advisors think about cost basis. The first phase of the legislation goes into effect on January 1, 2011, and may create significant workflow changes for your firm.

Social media shapes new investment strategy at USATODAY.com

You’ll let a friend walk your dog, drive your car or watch your teenager. Would you let them — or someone you don’t even know — invest your money?

Proposed IRS Regulations on Cost Basis Reporting Open for Comments

Posted on December 16, 2009 by in Compliance

Back in October 2008 I wrote about a passage in the Emergency Economic Stabilization Act signed into law that requires cost basis reporting by securities brokers (see the original FPPad post).

Today I learned from this AICPA Journal of Accountancy tweet that the IRS has posted proposed regulations titled “Basis Reporting by Securities Brokers and Basis Determination for Stock” available for viewing on the Federal Register website.

Click here to view the PDF in all its 141 pages of glory.

I don’t quite have the time to browse the proposal right now, but thankfully the folks over at the AICPA JofA just posted a good summary of the proposal.

Click here to read the AICPA’s JofA Regulations Proposed on Basis Reporting by Brokers.

Update 12/21/2009: Also read this article Brokerages face 2011 start date for reporting cost-basis info from InvestmentNews.

However, there’s no real insight as to what exactly the proposal means for independent financial advisers. Hint: It probably doesn’t change much of anything, as custodians are likely to bear the brunt of the regulatory changes. If anything, that means custodial fees likely will go up.

The comment period for this proposal is open until February 8, 2010 and a public hearing is scheduled for February 17, 2010. That will be a barn-burner of a hearing!

Is Cost Basis Reporting a Done Deal?

Posted on October 3, 2008 by in Taxes

On Friday October 3, President Bush signed the Emergency Economic Stabilization Act (H.R. 1424) into law.  What started out as a three page bill grew quickly into a massive 451 page behemoth.

The bill includes an array of revenue offsets located in the tax extenders portion of the bill.  One of the offsets of potential interest to FPPad readers is found in Section 403 (on page 244 in the PDF file linked above).  It’s a requirement for brokers to report a customer’s basis in securities transactions.

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