Burton:Tax Tip for the Day

 Use The Correct Cost Basis for Long-Term Gain when accountants calculate cost basis to figure gains, they may not take into account the re-invested dividends.  Reinvested dividends increase the cost basis, and remember; basis is not taxable.  People can end up paying a lot more in capital gains taxes if the wrong cost basis is used. It is important to have the correct basis when computing tax gain and loss.  Accountants often have to rely on the investor to get the accurate basis. It’s important for the investor to not just use the original price paid but add in all re-invested dividends or adjustments to basis.