DTCC initially launched its Cost Basis Reporting Service (CBRS) in 2003 to enable broker-dealer and bank client firms to pass cost basis on assets transferred via DTCC’s Automated Customer Account Transfer Service (ACATS). The Emergency Economic Stabilization Act of 2008 was signed into law on October 3, 2008, which includes provisions from the Energy Improvement and Extension Act of 2008 that requires brokers to provide cost basis reporting for securities. The Internal Revenue Service (“IRS”) and Treasury Department released final regulations for implementing cost basis and other information reporting requirements on October 12, 2010.
With the passage of cost basis legislation, the industry, including mutual funds, embraced the need for a system that would provide a centralized communications hub that would mitigate risk and promote standardization in order to meet their regulatory requirements in an efficient and cost-effective manner. Because mutual funds have unique attributes that must be considered when transferring cost basis information, a separate industry task force was formed in 2009 to develop a mutual fund user’s guide to augment DTCC’s CBRS User Guide, which is applicable to all security types.
This supplemental guide is intended to assist both business and systems personnel and service providers tasked with implementing the cost basis rules for mutual funds. It focuses on the transfer of cost basis information for mutual funds between reporting brokers. It is supplemental and should always be used in conjunction with the DTCC CBRS User Guide.
Please note that the DTCC CBRS User Guide under the Cost Basis Reporting Service (CBRS) section of Equities Clearing serves as the primary document governing the use of CBRS and must be consulted for additional details regarding the basic use of the CBRS system.
pdf Cost Basis Reporting Service (CBRS) Supplemental Guide for Mutual Funds (2.43 MB)