For those of you who invest in mutual funds, heed this helpful tax tip: Be sure to account for reinvested dividends in computing stock basis. If, like most mutual fund investors, you have your dividends automatically reinvested to buy more shares, remember that each new purchase hikes your tax basis in the fund. That, in turn, reduces the taxable capital gain…or increases the capital loss… when you redeem the shares. Forgetting to include reinvested dividends in your basis results in double taxation of the dividends…once in the year they were paid out and immediately reinvested, and later when they’re included in the sales proceeds. Mutual funds often report to investors the tax basis of shares redeemed during the year, including reinvested dividends. For the sale of shares purchased after 2011, mutual funds must report the tax basis to investors and to IRS.