Tax Lot Accounting

What Does Tax Lot Accounting Mean?
A record keeping technique that traces the dates of purchase and sale, cost basis, and transaction size for each security in your portfolio, even if you make more than one trade in the same security.

Investopedia explains Tax Lot Accounting
The goal is to minimize the net present value of your current taxes by deferring the realization of capital gains and recognizing losses sooner.

Filed Under: Accounting, Taxes

Related Terms

Capital Gain
Dividend
Net Present Value
Portfolio
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Related Links

A Long-Term Mindset Meets Dreaded Capital-Gains Tax - Investors should consider the impact of taxes on their returns and learn ways to minimize it.
Using Tax Lots: A Way To Minimize Taxes - The method of identifying cost basis can help you to get the most out of reduced tax rates.
Equity Portfolio Management Mechanics - Achieve analytical efficiency by applying your evaluation to a key set of stocks.

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