stock sale & capital gains tax

From: peterson1@iname.com
Subject: stock sale & capital gains tax
Date: Mon, 27 Jul 1998 11:37:44 -0400 (EDT)

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With the changes in the tax law, I have a question about 
how the new law works.  I believe that you pay a lower 
tax on your gains if you've held the stock for at least 
18 months.  So let's say you have the following 
situation.  Here are the dates and prices for purchase 
of XYZ stock.

Jan-95  100 shares  $12/sh
Jan-96  100 shares  $15/sh
Jan-97  100 shares  $18/sh
Jan-98  100 shares  $20/sh

Now in July 1998 you sell 200 shares.  In the past I 
believe that you had several options for determining 
your per share cost.  These were first-in-first-out, 
last-in-first-out, and an average.  But with the last 2 
options, you would be including shares that you held for
less than 18 months.  Does this mean your only option is 
to use the first-in-first-out method to determine your 
cost if you want to take advantage of the lower capital 
gains tax?


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