The basis of property shall be the cost of such property, except as otherwise provided in this subchapter and subchapters C (relating to corporate distributions and adjustments), K (relating to partners and partnerships), and P (relating to capital gains and losses).
The cost of real property shall not include any amount in respect of real property taxes which are treated under as imposed on the taxpayer.
(1) In general
In the case of the sale, exchange, or other disposition of a specified security on or after the applicable date, the conventions prescribed by regulations under this section shall be applied on an account by account basis.
(2) Application to certain regulated investment companies
(A) In general
Except as provided in subparagraph (B), any stock for which an average basis method is permissible under this section which is acquired before
(B) Election for treatment as single account
If a regulated investment company described in subparagraph (A) elects to have this subparagraph apply with respect to one or more of its stockholders—
(i) subparagraph (A) shall not apply with respect to any stock in such regulated investment company held by such stockholders, and
(ii) all stock in such regulated investment company which is held by such stockholders shall be treated as covered securities described in without regard to the date of the acquisition of such stock.
(3) Definitions
For purposes of this section, the terms “specified security” and “applicable date” shall have the meaning given such terms in .
(1) In general
In the case of any stock acquired after
(2) Treatment after transfer
In the case of the transfer to another account of stock to which paragraph (1) applies, such stock shall have a cost basis in such other account equal to its basis in the dividend reinvestment plan immediately before such transfer (properly adjusted for any fees or other charges taken into account in connection with such transfer).
(3) Separate accounts; election for treatment as single account
(A) In general
Rules similar to the rules of subsection (c)(2) shall apply for purposes of this subsection.
(B) Average basis method
Notwithstanding paragraph (1), in the case of an election under rules similar to the rules of subsection (c)(2)(B) with respect to stock held in connection with a dividend reinvestment plan, the average basis method is permissible with respect to all such stock without regard to the date of the acquisition of such stock.
(4) Dividend reinvestment plan
For purposes of this subsection—
(A) In general
The term “dividend reinvestment plan” means any arrangement under which dividends on any stock are reinvested in stock identical to the stock with respect to which the dividends are paid.
(B) Initial stock acquisition treated as acquired in connection with plan
Stock shall be treated as acquired in connection with a dividend reinvestment plan if such stock is acquired pursuant to such plan or if the dividends paid on such stock are subject to such plan.