Are here people with knowledge of German taxation + US brokerage accounts?
I would like to reduce my Berkshire exposure but can’t sell Berkshire shares bought before 2008 without losing extremely valuable tax advantages here in Germany.
10% of the Berkshire shares in a Schwab account were bought after 2008 and I just found that Schwab has the option to “Change Default Cost Basis Method for Account” from the default FIFO to the good old computer stack LIFO (Last In First Out) method.
I am not familiar with that as in Germany it’s always FIFO (as far as I know). I suppose if I change the cost basis for that Schwab account to LIFO and then sell 10% of the shares in that account the “Realized Gain/Losses” and the “Year End Report” which I provide to the German tax authority will then show as cost basis of those “bought after 2008” shares.
Is this correct? And does it so without additional comments like “Cost basis changed” or whatever which might be “strange” for the German tax authority and making them sceptical as the people there are probably are not used to LIFO?
Or is there even something in the German tax code saying it HAS to be FIFO (I of course can research that myself but maybe one of our Germans here knows already).
Does changing the cost basis has any disadvantages? To be on the safe side I am thinking of changing it immediatedly after the sale back to the default FIFO.
Thanks in advance for any helpful reply!
P.S.: Yes, I know full well that I should ask a German account but I rather do such on my own (last time I asked an account I was billed for a 100% wrong answer; after telling/proofing him that there was no reply) or rather the German tax authority itself (but such a “Verbindliche Auskunft” involves fees that can be difficult to calculate).