Cost basis
Cost basis
Cost basis
Cost basis information How we report your cost basis information Cost basis doesn't equal performance Covered and noncovered shares Cost basis methods available at Vanguard Minimum tax method Specific identification method Highest in, first out method First in, first out method Average cost method
Cost basis reporting: An overview
All sales of mutual funds, most exchange-traded funds (ETFs), and stocks will generate aForm 1099-Bthat provides detailed cost basis information to help you report capital gains and losses on your tax return.
Although we'll include details for sales of both covered shares and noncovered shares only the cost basis information for sales of covered shares will be reported to the IRS. Cost basis for sales of noncovered shares will be reported solely to you.
Get details on covered & noncovered shares
For mutual fund accounts
Form 1099-B lists sales, exchanges, and redemptions (including checkwriting activity) from most nonretirement accounts.
For brokerage accounts
Form 1099-B reports sales, mergers, bond maturities, and aggregate profits or losses on regulated futures contracts.
What's reported for my mutual fund sales?
Here's a simple example of how cost basis information is reported to you—or to both you andthe IRS:
| Investor A | Investor B | |
| Date shares purchased | June 1, 2010 | January 20, 2023 |
| Dates shares sold | October 1, 2023 | October 1, 2023 |
| Type of shares | Noncovered | Covered |
| Cost basis reported to … | Investor A only | Investor B and the IRS |
Investor A
Date shares purchased
June 1, 2010
Dates shares sold
October 1, 2014
Type of shares
Noncovered
Cost basis reported to …
Investor A only
Investor B
Date shares purchased
January 20, 2014
Dates shares sold
October 1, 2014
Type of shares
Covered
Cost basis reported to …
Investor B and the IRS
You remain responsible for reporting your cost basis information to the IRS on Form 8949 and on Form 1040, Schedule D, for all shares sold, whether they're covered or noncovered.
For covered shares
The information you report in column (e) of Form 8949must matchwhat we send to the IRS onForm 1099-B.We aren't required to make certain adjustments that are necessary for your tax return. For example, we don't adjust basis for wash sales when the purchase or sale is in another account or for taxes paid on gifts. Pay close attention to the IRS instructions for Schedule D and Form 8949.
For noncovered shares
Vanguard only has average cost information for mutual funds, so you're responsible for your recordkeeping if you used another method.
A special note about bonds
Wondering why the cost basis on your individual bonds changes daily?
Unlike your mutual fund, ETF, and stock investments, any income reporting adjustments that affect your cost basis will be applied to your bonds daily and made available online.
