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Cost Basis

Understanding your cost basis

Your cost basis is the amount you paid to purchase shares of a mutual fund, including reinvested dividends. Tracking your basis is important because when you sell your shares it is used to determine the capital gain or loss.

Methods for calculating cost basis

There are several IRS-approved methods for calculating the cost basis of your shares.
See IRS Pub. 550, Investment Income and Expenses, for additional information.

How Janus calculates your cost basis

Janus calculates cost basis for shareholders using the average cost single-category method. To determine whether you are eligible to use the information provided by Janus and whether this method is best for your tax situation, please consult your tax adviser.

First, Janus adds up the total adjusted basis of all the shares you owned in the fund at the time of the sale or exchange, regardless of how long the shares were owned. This total is divided by the total number of shares owned at the time of the sale or exchange to find the average cost basis per share. Then, Janus multiplies the average basis per share by the number of shares being sold to find their average cost basis. When average cost basis is subtracted from the proceeds on the sale or exchange, the result is the gain or loss.

Janus will also let you know whether your gain or loss is short-term or long-term. The shares sold or exchanged are considered to have been the first shares purchased.

See the sample calculation.

Sample calculation:

Date of Purchase Total Purchase No. of Shares
May 1, 2000 $1,100.00 100
August 5, 2000 $500.00 40
December 10, 2000 $150.00 10
$1,750.00 150
  1. Average cost basis per share prior to redeeming: $1750.00/150=$11.67 per share
  2. Redeemed $1000 on January 5, 2002 selling 80 shares.
  3. Basis of the redeemed shares = 80 shares (total number of shares redeemed) multiplied by $11.67 (average cost basis per share) totals $933.60
  4. $1000 (redemption proceeds)-$933.60 (basis of redemption) totals $66.40 gain.
  5. Sell first 80 shares purchased on May 1, 2000 for a long-term gain (shares held greater than 12 months).

Don't forget your reinvestments

For purposes of basis calculations, reinvested dividends and capital gains distributions are the same as any other share purchase.


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Please consider the charges, risks, expenses and investment objectives carefully before investing. Please see a prospectus , or if available, a summary prospectus containing this and other information. Read it carefully before you invest or send money.

Any tax or legal information provided is a summary of our current understanding and interpretation of the current income tax regulations and is not exhaustive. Investors should consult their tax advisor or legal counsel for advice and information concerning their specific situation.

Additional activity, such as purchases, dividend reinvestments and redemptions, may change your average cost basis. When applicable, the average cost will be updated on the following date to reflect such transactions.

Janus Distributors LLC