What is MinTax, and how is it calculated?
MinTax is one of the cost-basis selection methods used to determine the cost of a position when it is sold. The default method for Sell orders at Public is MinTax, which sells the tax lot of the position with the lowest tax consequences first. This tax methodology is how the cost basis for realized gains and losses is calculated on your tax documents.
For reference, MinTax calculates the cost-basis of the sell in the following order:
Short-term capital loss from largest to smallest.
Long-term capital loss from largest to smallest.
Short-term zero gain or loss.
Long-term zero gain or loss.
Long-term capital gain from smallest to largest.
Short-term capital gain from the smallest to largest.
Each category is exhausted before moving to the next. If the cost of the original share is unknown, we'll treat the cost basis as zero. This is how any realized gains or losses are reported for tax purposes at the end of the tax year.
What other methods do you offer?
While MinTax is the default, If you would like to update the tax methodology to FIFO (First in, First Out) or LIFO (Last in, First Out), we can opt into this for you. Please contact our Member Support Team via chat or email at firstname.lastname@example.org to get that request started.
Please note that this is for informational purposes only and should not be considered tax advice. Public members should consult their tax advisors concerning any applicable tax laws.