Growing Roster of Companies Sign On For Cost-Basis Service
An expanding number of Fortune 500 companies, including Disney, Johnson Controls and Aflac, have started offering their shareholders AccuBasis, a service that provides accurate cost-basis information quickly and efficiently.
Investors need cost-basis information to report gains or losses when filing tax returns and for determining the unrealized gains or losses of a securities position. AccuBasis, offered through DTCC Solutions and NetWorth Services, Inc., automates and streamlines researching and calculating cost-basis information, which traditionally has been a difficult, time-consuming and expensive task.
Information within seconds
With security pricing dating back as far as 1925, AccuBasis delivers accurate cost-basis information within seconds, automatically applying to the original acquisition price the corporate actions that affect cost-basis such as stock splits, mergers, dividend reinvestments and other cost-basis adjustments.
Most companies offer AccuBasis through a link on their Web page. The link connects them to the AccuBasis Web site where the investor can access cost-basis information by simply entering a CUSIP number, the security name or ticker symbol and the approximate date of purchase (a year will do).
Boosting shareholder satisfaction
“We’ve been getting an increasing number of calls from investors requesting cost-basis information,” said Freda Gore, senior vice president/chief operating officer of Waccamaw Bankshares, a North Carolina bank founded in 1997. “Up until now, we’ve been doing it manually and it’s been taking a great deal of time. Once we saw AccuBasis, we knew we had the solution to the problem.”
Other companies offering AccuBasis to their shareholders include Alltel, Otter Tail Corporation, H&R Block, Union Bank & Trust Co., RW Baird, Integrated Software Solutions, Sterne, Agee & Leach, Trustmark National Bank, Horizon Publishing and Hantz Tax and Business Services.
Helping customers meet new legal requirements
“The financial services industry expects that the U.S. Congress, in 2008, will pass a law requiring all financial intermediaries to report – much like a 1099 – adjusted cost-basis information to both investors and the Internal Revenue Service for all transactions on or after January 1, 2010,” said Joseph Trezza. DTCC vice president, Product Management, Asset Services. “Many issuers and their transfer agents expect to be impacted by these legislative changes.”
The cost-basis provision, part of the Housing Assistance Tax Act of 2008, would apply to stock acquired after January 1, 2010, and after January 1, 2011, for all other instruments. Many banks, brokerage firms and mutual fund companies have begun testing AccuBasis in anticipation of proposed legislation which would cover stock, debt, commodities, derivatives and other securities specified by the government.
“This could be a major financial burden for firms that have to do manual tracking of cost-basis information, requiring hundreds of hours of research and reporting,” said Trezza. 