All Forum Posts by: Damon Kellar

^^^^  This.
Most decent brokerage firms will keep track of the basis in various distributions you have.  Depending on your income / current effective tax rate (the rate that applies to the next $ you earn), I would seek to minimize the overall impact.  LT capital gain is typically at 20%, whereas ST capital is at your ordinary income effective rate.  

For example - I bought 100 shares of AAPL 8 years ago.  If I sell those shares (or a portion of those shares) it's all LTCG.  But if I sell the dividend reinvested shares that I just got it could be a mix of STCG or LTCG depending on age.  Those shares also have a higher basis that if I sell those I would recognize less gain since I paid tax on the dividend as I received it.  Again your brokerage firm should be reflecting these amounts in the tax lots view of your account.  If not, they should be able to tell you somewhere.