Welcome!
Welcome to Wolters Kluwer Financial Services’ Cost Basis Reporting Resource Center—your source for essential cost basis reporting law compliance information.
Cost basis reporting is law. It’s time to take action to comply.
With the cost basis reporting law’s initial effective date of January 1, 2011 less than two years away, it is critical that brokers, return preparers, tax advisors and taxpayers take action now to comply on time.
Wolters Kluwer Financial Services has been a leader educating the industry about this law and about the technology and information complexities that need to be addressed to meet its requirements. Additionally, we offer both the tax intelligence expertise and the technology to help you comply.
What You Can Find on the Cost Basis Reporting Resource Center
Know the law - Read the law, public comments to the IRS, whitepapers and other important documents relating to the cost basis reporting law.
Stay current - Access recent pertinent industry articles and webinar content.
Ask our experts - Send your cost basis reporting and corporate actions questions to our subject matters experts.
Read the Blog - Join industry leaders and peers on our BLOG for conversation around the law.
“…another major consideration is time: Is there enough time for the firm to meet the implementation deadlines? Firms that are starting from scratch must create project teams, write requirements, build the functionality, and then test the systems in time to be ready to report on capital gains on 1099 forms for 2011.”
TowerGroup Report: “Cost Basis Technology for Broker-Dealers: Build, Buy, or Both?” by Sean Cuniff, January, 2009 Reference # V57:38O.
Learn more about the law & system compliance requirements.
Click here to request TowerGroup’s: “Cost Basis Technology for Broker-Dealers: Build, Buy, or Both?” report.
“Of the brokerage platforms that TowerGroup ... examined, 100% need some level of enhancement in order to comply with cost basis requirements of the new law ... TowerGroup believes that the majority of platforms need to be enhanced substantially.”
TowerGroup Report: “Cost Basis Technology for Broker-Dealers: Build, Buy, or Both?” by Sean Cuniff, January, 2009 Reference # V57:38O.
The cost basis system needs the ability to handle all tax lot relief methods allowed by the IRS (FIFO and specific identification plus single-category and double-category averaging for mutual funds and dividend reinvestment plans – DRIP) for determining the basis of securities sold.
Learn more about the law & system compliance requirements.
Click here to request a Cost Basis Reporting Law Readiness Check List.
Click here to request TowerGroup’s: “Cost Basis Technology for Broker-Dealers: Build, Buy, or Both?” report.
There is a significant tax penalty risk if the basis and holding period information reported on Form1099-B is incorrect. There are separate penalties for 1099s provided to the IRS and 1099s provided to taxpayers, and they aggregate to $100 per incorrect 1099 (with an annual maximum of $350,000 per year before interest). If the error is due to intentional disregard, the combined penalties are 10 percent of the amount that should have been reported (without any maximum limit).
Learn more about the law & system compliance requirements.
Click here to request TowerGroup’s: “Cost Basis Technology for Broker-Dealers: Build, Buy, or Both?” report.
On Friday, October 3rd, 2008, President George W. Bush signed H.R. 1424, the Emergency Economic Stabilization Act of 2008 into law (the Act, Pub. L. No. 110-343). The law requires cost basis reporting by brokers to the Internal Revenue Service (IRS) and to taxpayers. The initial effective date for cost basis reporting for most stocks applies to stock acquired on or after January 1, 2011; for mutual funds and dividend reinvestment plan stock (or similar arrangements) acquired on or after January 1, 2012; and for debt instruments, options and other covered securities acquired on or after January 1, 2013. The provision is scored to raise $6.67 billion over a ten year period. To review the law, click here and go to Title IV, Section 403.
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Cost Basis
Reporting Blog
IRS Asks for Comments to Assist its Drafting of Cost Basis Guidance.
On Friday, Feb. 6, 2009, the IRS released Notice 2009-17 (the Notice, copy attached). The Notice indicates that the IRS intends to issue guidance regarding a number of important details relating to the new cost basis reporting law that was enacted on Oct. 3, 2008 (Pub. L. No. 110-343). To assist, the Notice requests public comments regarding the new law, including comments on 36 specifically listed topics. Read More
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2008 Top Ten Corporate Actions
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