How to Specify WHICH Shares of a Stock or Fund You’re Selling

But first a quick one:

Remember Quickbrowse? Long-term readers were among the first to see it, and quite a few of you have used “Q-Page” to have this column delivered to you every morning. (To do that, just go down to the bottom of this column and click the Q-Page icon. Mornings when I’m late with it, you’ll get yesterday’s column again, but that’s my fault, not Quickbrowse’s.)

Well, guess what. It’s lunacy, of course, but wasn’t Marc’s dog Looe excited when we got a write-up in Red Herring last week. And then — arf! arf! — a follow-up where one Red Herring reader thought Quickbrowse might be worth “ten to thirty million!” (Not that we noticed any checks attached to his e-mail.) If anything comes of this, Looe — whose photo, over my protest, has been removed from the Quickbrowse site — will be in filet mignon for the rest of his waggy-tail life.

And now down to cases:

John McInnis: “You say, ‘If you’ve been buying shares in a high cost fund all along, sell the shares for which you paid the highest price but keep those you bought way back when.’ My question is: how exactly do you do this? In the olden days, when dealing with a flesh-and-blood broker, you would send him a note saying something like ‘Please sell the 100 shares of XYZ purchased on 4/1/66 and not the ones I bought last week.’ Of course the shares are all the same to your broker and you, but this polite fiction was sufficient to hold the IRS at bay. Nowadays though, with online brokerage accounts, how do we effect this little charade?”

Send the note anyway and keep a copy with your tax records. (Actually, since these are no longer the olden days, fax it and you won’t even have to make a copy.) You’re not likely to be audited, but if you are, and you have good records — along with clear instructions to your broker directing him to sell “the 300 shares versus purchase date 7/13/93” — it seems to me you’ve done your bit. (Don’t blame me if the IRS disagrees. I limit my liability in this to price you paid for this column.)

But you raise a good point. An enhancement on-line brokers could easily add is an optional field in which to enter the VSP date (VSP = versus purchase). The deep discounter I use has “beginner,” “intermediate,” and “advanced” display modes. So why not offer a VSP field on the advanced display? If a client enters a date, the confirm and monthly statement he receives should both reflect that VSP date.