Cost Basis Calculator

How to calculate cost basis, lot by lot

Basis is a property of a lot, not of a position. A lot is one purchase: one date, one share count, one price. The formula for a single lot is short:

Lot basis = shares x price per share + commission

Commissions and other acquisition costs are part of what you paid, so they belong in basis (IRS Publication 551). A $9.99 trade commission raises your basis by $9.99 and lowers your eventual gain by the same amount.

Take three purchases of the same stock, each with a $5 commission:

Total: 150 shares, $6,015 of basis, $40.10 per share on average. Your broker will often show you only that blended per-share number. It is not enough. The moment you sell part of the position, the lot view is what decides which shares left the account, what basis went with them, and whether the resulting gain is short-term or long-term. Two of those three answers are invisible in a blended figure.

FIFO, LIFO, and average cost: how the method changes your gain

Keep the same three lots and sell 120 shares on August 1, 2026 at $70. The sale spans more than one lot, so the method decides which shares are consumed. Each lot contributes the smaller of what it still holds and what the sale still needs, then the walk moves on to the next lot in order.

Same shares, same sale price, three different answers, and the largest is exactly $1,200 apart from the smallest. Which one you may use is not a preference:

• FIFO is the default for stocks whenever you have not identified specific shares.
• Average cost is limited to mutual fund shares and DRIP shares (IRS Publication 550, "Average Basis"; Treas. Reg. Section 1.1012-1(e)). It is not available for individual stocks. Even when you do use it, the shares are still deemed sold first-in-first-out for holding-period purposes, which is why the average-cost row above carries the same 100/20 split as FIFO.
• Specific identification requires that you told the broker which shares to sell at the time of the trade, and that the broker confirmed it. Deciding afterward does not count.

LIFO appears here because brokers do offer a last-in-first-out lot-selection setting, and because seeing it next to FIFO makes the trade-off obvious: a smaller gain that is short-term is not automatically the better outcome.

Adjustments that change your basis: splits, reinvested dividends, and fees

A stock split is not a taxable event and it does not change your total basis. All it changes is how that basis is spread. A 2-for-1 split on 100 shares with a $5,000 basis gives you 200 shares at $25 each, still $5,000. A 1-for-10 reverse split gives you 10 shares at $500 each, still $5,000. The holding period rides along: post-split shares keep the acquisition date of the shares they came from, so a split never resets the clock. This calculator takes the ratio as two numbers, so 3-for-2 is 3 and 2, and 1-for-10 is 1 and 10.

Reinvested dividends are the adjustment people forget. You paid tax on the dividend in the year it was declared, and the cash then bought more shares. Those dollars are basis. Leaving them out is the most common way people overpay on a long-held position, because a year of small reinvestments adds up and then a decade of them really adds up. This tool takes one total figure and spreads it across your lots pro rata by share count, which gets the total exactly right. If the acquisition dates of the reinvested shares matter to your short-term and long-term split, enter each reinvestment as its own lot row instead.

Commissions and fees land on both sides. Buying costs get added to basis, and selling costs come off what you realized (IRS Publication 551). A $9.99 fee on each side of a trade moves the gain by $19.98, which is small on one trade and not small across a year of them.

Run the three-lot position above through all three adjustments: a 2-for-1 split turns 150 shares into 300 at half the per-share basis, $6,015 of total basis unchanged; $300 of reinvested dividends then lifts every share by $1.00, so total basis becomes $6,315; and the $15 of buy commissions is already inside those lot figures.

Short-term or long-term: where the line falls

Long-term means you held the shares more than one year. The counting rule is what trips people: you start counting on the day after you acquired the shares and count through the day you sell (IRS Topic No. 409). So shares bought on June 10, 2025 first become long-term on June 11, 2026. Selling on June 10, 2026, the exact anniversary, is short-term. One day of difference, and on a large position it is an expensive day.

The test runs per lot, then the results are summed, so one sale can land on both sides of the line at once. In the FIFO example above, 100 shares are long-term and 20 are short-term because the third lot was bought six months before the sale. The calculator classifies each depleted slice, adds up the long-term side, and derives the short-term side by subtraction so the two always reconcile against the total.

A stock split does not restart the clock, and neither does a reverse split. A leap-day purchase is handled the way the calendar handles it: shares acquired on February 29, 2028 become long-term on March 1, 2029.

What the two buckets actually cost you is a separate question, and it depends on your filing status and your total taxable income rather than on this trade alone. Take the split from here to the Capital Gains Tax Calculator, or, if the sale produced a loss, to the Tax-Loss Harvesting Calculator for netting and carryforward. A large realized gain can also pull in the net investment income tax, which the NIIT Calculator covers. For equity compensation, where every vest or purchase is its own lot with its own date, use the RSU Tax Calculator or the ESPP Tax Calculator. To see the gain sitting inside a whole return next to your credits and deductions, download Tax47.