GainsKeeper Blog

The Senate, on a 93-2 vote, passed a bill that included cost basis reporting on September 23, 2008. It was part of the energy and tax extenders substitute amendments to HR 6049 that were introduced in the Senate Finance Committee Tuesday last week. Section 403 of the energy portion of the amended bill (the Energy Improvement and Extension Tax Act of 2008) is cost basis reporting and it is estimated to raise $6.67 billion over 10 years.

The bill now returns to the House for consideration in its revised form. Recall that cost basis reporting has passed the House on three separate occasions—twice last December and once in May of this year. House Ways and Means Committee members want to break up the bill in pieces and then resubmit the separate bills once passed by the House to the Senate because its cost is not fully offset by revenue measures. However, because of the short time remaining on the Congressional calendar before the election recess it is not clear if this will happen.

The cost basis reporting provision is essentially identical in detail to earlier versions previously reported. The only important difference is that the three staggered effective dates are each pushed back one year. Thus, the effective date for cost basis reporting for most stock would apply to stock acquired on or after January 1, 2011; for open-end mutual fund and dividend reinvestment plan stock acquired on or after January 1, 2012 and for debt instruments, options and other covered securities acquired on or after January 1, 2013.

Stevie

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