What transactions can affect cost basis?
Any transaction that increases or decreases the number of shares in a position can affect cost basis. When you buy or sell shares of a security, the cost basis of your position in that security will change. Depending on the type of security, factors other than the original purchase price of a security can have an impact on cost basis. Events such as splits, spin-offs, and liquidations can all affect cost basis. Consider consulting a tax advisor with your specific questions about calculating gains and losses in your individual tax situation. Other transactions which can affect the cost basis of your holdings include the following: Dividends and capital gains Dividends and capital gain distributions that you receive in cash do not affect the basis per share of existing shares. Each time you reinvest dividends or capital gains, you are purchasing additional shares; these purchases may change basis for the total position, but not the per share basis of existing shares. You assume per share
