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Topic: How do I report increased cost basis? (

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xman
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Joined: 11 Jan 2011
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Posted: 17 Mar 2011 at 09:17 \| IP Logged

If I am selling stock whose basis was increased due to a wash sale in previous year, how do I report the increased basis?

I have looked up Schedule D instructions which says that I should report this in the cost basis column(column (e)), but I have to attach an explanation of the adjusted basis change.
Where should I attach the explanation saying that the basis was increased due to a wash sale? Do I just write on the next line, basis adjusted due to wash sale? Or do I need to attach a separate letter?

miyo
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Posted: 17 Mar 2011 at 09:42 \| IP Logged

I would just increase the stock basis and not necessarily go to the trouble to adding an explanation of the basis change. If the IRS is really interested later, they can send you a letter on it and you can send the explanation then.

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