Lincoln Journal Star from Lincoln, Nebraska • 15

PERSONAL FINANCE Business NEBRASKA ffSEXOB STOCKS, MUTUAL FUi www.joumalstar.combusiness 5B journal Star Saturday, March 31, 2001 mm "Financial plaiuimg cm reduce tax Calculating gains and losses can be an important step for investors Stocks rise at end cf slumping quarter NEW YORK U.S, stocks ended higher Friday as investors celebrated an end to a dismal quarter that left the Dow industrials down 8 percent and the Nasdaq composite index down a whopping 25 percent The Nasdaq ended up 19.69 1.08 percent, to 1840.26 and the Dow was up 79.72, or (X81 percent, to 9878.7a The 500 was up 12.38, or 1.08 percent, to 1160.33. The Nasdaq's 25 percent loss was its biggest firstquarter loss on record, easily beating the 13.3 percent loss registered in the first quarter of 1980. It was also the fourthrbiggest quarterly loss ever for the index. The 500, meanwhile, plunged 12.12 percent over the last three months. The lack of real news left the market struggling for direction for most of the momirt Friday, but buying picked up in afternoon trade, with Internet oil and financial stocks leading the charge.

On the Dow, American Express (AXP) surged 6 percent to 41.30 after Business Week's "Inside Wall Street column reported that some investors believe Citigroup (C) Chief Executive Sanford Weill wants to acquire American Express as his last big takeover before retiring in the next few years. Poll: Interest falls in Social Security plan WASHINGTON Americans' enthusiasm for President Bush's idea of investing Social Security contributions in the stock market has dropped sharply along with the market says an Associated Press poll. The poll taken after two of the roughest weeks the market has had in recent years shows they're about evenly split on that idea now. Ahniit half in thf mil ner- f' ih f-' Kv 4 r-. I i- A BY PAMELA YIP The Dallas Morning News Filling out your federal income tax return is a surefire way to find out whether you've planned appropriately for taxes.

And some mutual fund investors are finding out that the fallout from a lack of planning can be humbling and costly. One of more challenging tasks for investors is knowing how to calculate gains and losses from the sale of fund shares. The message would be: You need to do the planning before the sale," said Bill Jackson, partner in charge of the DallasFort Worth Private Client Service practice at Andersen, the newly adopted name of professional services firm Arthur Andersen LIP. In other words, get your ducks in a row now for next year. the task can test taxpayers' record-keeping abilities because a fund's gain or loss could be based on transactions that took place years ago, daring to when they started investing in that particular fund.

Taxpayers should stay focused on one goal "What will give me the best tax result?" said J. Richard Joy-ner, a partner in Personal Financial Counseling at accounting firm Ernst Young in Dallas. Fund investors who didn't plan well in 2000 will find fewer fools are available to minimize the tax on capital gains from partial sales of fund shares. Capital gains are profits from the sale of investments. To determine the gain or loss when you sell fund shares, you need to know two things The price at which you sold the shares and your "cost basis," that is generally the original price you paid tor the shares.

In effect the basis tells you how much you paid for the shares you sold, and therefore how much tax you'll have to pay, assuming you sold the mutual fund shares at a profit. The higher the basis, the smaller the gain and the less tax you'll owe. In the case of an investment loss, the higher the basis, the bigger your loss. That's to your advantage because you can use fosses to offset gains when doing your taxes. get me the best tax result (a capital toss that may onset other capital gain distributions)," Joyner said.

"If I can do this, I will almost certainly want to choose the highest cost shares (the ones bought most this year) if the value of the fund dropped over the course of the year, he said. When you're using the specific identification method, make sure you sell shares that you've held for more than a year or you won't be able to take advantage of the 20 percent long-term capital gains tax rate. Short-term capital gains those from shares held one year or less are taxed at regular income tax rates, which could be as high as 39.6 percent Unfortunately, if you didn't plan ahead to use the specific identificar tion method, you're out of luck. "Some of the methods are not available to someone who's ing their tax returns today," Jackson said The accounting techniques at your disposal if you didn't plan your fund sales well are the "average cost" (single category) method and the "first-in, first-out" or FIFO, method, he said. The average cost (single category) method considers the cost basis of your fund to be the average basis of all the shares you own, a figure that changes as you continue in-vestJng in the fund You figure the average cost per share by dividing your total basis for all snares in the account by the number of shares.

If you had reinvested dividends and capital gains distributions, count them as part of your cost basis. This will raise your basis and reduce the gain and the tax. You'll still need good records to use the averaging method. Once you use the average-basis method, you must continue to use it for all accounts in the same fund. The other accounting method you can use is FIFO.

Generally, this is the least desirable technique because it requires you to calculate gains or losses as if the shares were sold in the order that you bought them. Your gain and therefore your tax would be higher. KNIGHT RIDDER NEWPAPERS the DallasFort Worth Private Client firm Arthur Andersen LLP. gain or loss on the sale of fund shares. Each of these methods has advantages and disadvantages: If you kept impeccable records and planned ahead (make a note of this for next year), the best calculation method to use is the "specific identification" method With this technique, you sell specific shares, identified at the time of sale.

This gives you the most flexibility because you can pick exactly which shares are being sold You pick the ones with the highest basis because that will reduce your gain from the investment by the greatest amount "The specific identification method is the best method because it allows you to pick and choose which shares you are going to sell," Jackson said. The catch about using the specific identification method is that cent, said they support a plan to give people the option of investing some of their Social Security contributions, while 44 percent op-pose it says the poll conducted for the AP by ICR of Media, Pa. The five-day poll was started a week ago, after the market had lost more than 12 percent of its value in just over two weeks, in Farmers likely to increase plantings of gene-altered crops, USDA says Eight companies honored with construction awards Bill Jackson is the partner in charge of adopted name of professional services If you sold all your fund shares at the same time, knowing your sales prices and original cost is easy. Fund investors may run into complications when they sell partial shares of their fund. In this case, the hard part is figuring your cost basis because, like many investors, you probably have an automatic investment plan in which you bought shares at different times and at different prices.

That may have taken on special importance last year, when the Nasdaq composite index peaked in March and skidded from there. Investors who sold off only part of their holdings in a stock fund to hedge their bets need to be sure that they pay close attention when calculating gains and losses on their funds. There are several accounting methods you can use to figure the Historical to $2 million; R.L Fauss Builders, Fremont Historic Visitor's Center and Chamber Offices, Historical restoration under Omaha Door and Window Courtyard by Marriott, downtown Omaha, Historical Restoration under Avars Avars, York Country Club, million to $5 millioa The Merit Shop Project of the Year award was presented to Shanahan Mechanical Electrical for Man Roland press installatioa The INSPROEMC Project of the Year award was presented to Advanced Office Interiors for First National Bank of Omaha. The Associated Builders and Contractors represents more than 230 merit shop contractors, subcontractors, material suppliers, manufacturers and associate members throughout the state. Fri Wk Wk Chg VTD Chg Last Chfl 9,878.78 2,771.36 381.42 595.66 877.04 1,840.28 1,160.33 450.53 10,645.85 79.72 17.93 8.25 6.98 15.59 19.69 12.38 9.00 127.77 374.00 126.02 29.94 17.79 15.67 20.50 7.26 170.47 3.93 4.76 8.52 3.08 1.82 1.80 1.64 1.63 YTD Chg Chg Nam Dtv PE Last Service division of Andersen, the newly you had to have told your broker or fund company that you wanted your fund shares sold in that manner.

"In order to use that method, I must have identified the specific shares to be sold in writing to the broker when I initiated the sale," Joynersaid And the broker must confirm that those were the shares sold, he said. The specific identification method makes particular sense when the stock market has been volatilesaid Tom Faust chief equity investment officer at Eaton Vance Corp. in Boston, a mutual fund firm, like the 2000 stock market "If I owned shares in a technology fund and bought more shares in March or April when prices were at their highs for the year, the specific identification method will probably shows that farmers see the tremendous benefits of this technology." About 24 percent of the 2001 com crop will be genetically engineered, compared with 25 percent last year, USDA said The biotech industry was embarrassed last year when a gene-altered variety of com, known as StarLink, was found in the food supply without being cleared for human consumption. StarLink, one of the least ased of the various biotech com varieties, has been withdrawn from the market But farmers are concerned that stray seeds from last year's StarLink crop may sprout in their fields and have been encouraged to plant biotech soybeans on that acreage. Any wild StarLink plants will die when the genetically modified soybeans is treated with herbicide.

Although there is strong resistance to biotech food in Europe and Japan, most U.S. -grown com and soybeans are consumed domestically. Yield-robbing weeds have long been a problem for soybean growers, so development or the biotech varieties has made it much easier to grow the crop. Many farmers have Most Active si mom) Name Vol (00) Last Chg Agere 2031599 6 18 GenBecs 1499011 41.98 157 Lucent 1123729 9.97 EMCs 1086255 29.49 Abas 1076992 40.5010.45 Gainers ($2 or more) Nam Last Chg Chg CSFBdr 4.55 2.05 82.0 AuroraF 6.90 2.09 43.5 Welder 2.85 .85 42.5 Alzas 49.50 10.45 34.8 Entravann 9.90 2.49 33 6 Losers ($2 or mors) Name Last Chg Chg PemTrty 10.17 Blount 4.40 FrkEPb 3.00 -141 -320 IBP 16.40 CenterTrst 3.92 -154 -282 Most Active Name Vol NasdIOOTr 3487342 SPDR DJIADiam SemHTrn Nabora Gainers Nam Last Terremark 250 Hemispx 5.00 SevenSeas 340 Uppery 375 Radiotogix 4.90 Losers Nam Last Team 225 MSCSCO012.28 MSSunOI 3.52 MatecCps 425 B2Blnet 5.88 The Comhusker Chapter of Associated Builders and Contractors honored eight companies at its Excellence in Construction Awards ceremony. The following companies received awards (company, projects, category): General Etavating, Bryan LGH-East Environmental Cleanup, Environmental-open, and McLeod U.SA: Omaha Cable Installation, Inirastmcture'open; Shanahan Mechanical Electrical, Man Roland press installation, Electrical Industrial-under $500,000 and Lincoln Journal Star production facility, Mechanical million; Stephens Smith Construction Tallman Foundation, Specialty Residential-open; Advanced Office Interiors, eFrame Technology Solutions, Interior Finish-over and First National Bank of Omaha-Federal Trust Building, 52-Week High Low Nam 11,425.45 9,106.54 3,157.44 2,348.70 418.25 284.12 68M9 550.57 1,034.78 827.92 5,022.24 1,794.21 1,534.66 1,081.19 577.80 419.70 14,703.89 10,261.91 Dow Jones Industrials Dow Jones Transportation Dow Jones Utilities NYSE Composite AMEX Index Nasdaq Composite 500 Russell 2000 Wllshire 5000 VTD expanded their acreage as a result In other cases, the crop has freed up time for growers to take off-farm jobs to supplement their incomes.

"There are a lot of different opportunities there," said Tony Anderson, president of the American Soybean Associatioa "There's no doubt about the appreciation of the technology that Roundup-ready offers." A spokesman for Monsanto said there should be no shortage of seed, but Anderson said some of the most prized varieties may not be available everywhere. The USDA report also confirmed that fanners are cutting back on overall com acreage this year largely because of higher energy and fertilizer prices and switching to soy beans Farmers are expected to grow about 76.7 million acres of both crops this year. That would represent a decrease of 4 percent in com plantings from last year and a 3 percent increase for soybeans. In Iowa, which ranks No. 1 in both com and soybeans, farmers will plant an estimated 11.9 million acres of com this year, down from 123 million in 2000.

Most Active 91 or Nam Vol (00) Last Chg CecO 6481125 15.81 Nsls 3199794 2631 SunMicro a 2739553 15.37 Oracle 2135212 14.98 Palm 2099008 8.41 Gainers ($2 or Mon Nam Last Chg Chg UnivBcp 2.50 1.50 150.0 iXLEntp 2.38 1.31 123.4 EmexCorp 13.44 7.00 108.7 WebExn 11.13 5.25 89.4 Fonar 2.00 .91 82.8 I Losers $2 or Mong Nam Last Chg Chp SafeNet 1233 NvtlWrtsn 2.06 Covtsta 2.00 Vyyolncn 2.03 AlComm 525 -473 1.95 53.9 128 60.4 1.28 51.8 1.50 44.1 0s or mor4 cluding the biggestever weekly point decline in the Dow Jones industrial average. In polls taken late last year, "people supported allowing investment of Social Security contributions by a 2-1 margin. Foot-mouth scare sends prices lower CHICAGO A shorWived foot-anckriouth disease scare in North Carolina touched off panic selling Friday on the Chicago Board of Trade, leaving grain and soybean futures sharply lower for the day. Wheat was the biggest loser, losing about 4 percent of its An Associated Press report that North Carolina agriculture officials had sent samples of dead hog tissue for testing for possible fbot-anckriouth disease touched off chaotic trading in the pits that drove prices quickly lower. A harf-bqur later, the U.S.

Department of Agriculture said the test turned out negative, and the downturn was hatted. But buying enthusiasm vanished, as the incident highlighted bngexisting fears that footandmouth might eventually emerge in the United States. IBP shares tumble after Tyson decision KANSAS CITY Shares of IBP the biggest U.S. beef packer, plunged as much as 34 percent Friday after Tyson Foods Inc. abruptly terminated plans to buy the company for $4.7 billion.

Tyson, the world's largest chicken marketer, backed out of the deal late Thursday, claiming IBP misled It when the two signed a buyout agreement on New Year's Day. Tyson said it did not know the Securities and Exchange Commission Informed IBP on Dec. 29 of an extensive inquiry into IBP's financial statements. IBP, which Is also the second-biggest U.S. pork processor, maintains that Tyson doesn't have any valid reasons to discontinue the merger process.

The company said it has resolved the SEC's issues. But the announcement pulled IBP shares lower, to close down 28 percent at $16.40 on Friday, while Tyson stock closed up 17 percent at $13.47. From wire reports The Associated Press WASHINGTON Farmers will sharply boost their plantings of genetically engineered soybeans this year, despite opposition to biotechnology overseas and signs of unease among U.S. consumers, the government said Friday. About 63 percent of this year's soybean crop, or about 48 million acres, is expected to be genetically engineered, up from 54 percent in 2000, according to the Agriculture Department's annual survey of farmers' planting intentions.

The biotech soy is immune to the Monsanto popular Roundup weedkiller. "Clearly farmers like using Roundup-ready soybeans," said Bill Nelson, a commodity analyst with AG. Edwards Sons. Slightly under 10 million acres of the cotton that farmers will plant this spring, or 64 percent is expected to be biotech, compared with 61 percent in 2000, USDA said Biotech cotton is either resistant to insect pests or herbicides, or both. "The reports of our death are erroneous," said Lisa Dry, a spokeswoman for the Biotechnology Industry Organizatioa "It just Market watch March 30, 2001 Dow Jonas 79.72 Industrials 9,878.78 Standard "-f133'7MW" Poors 500 1,160.33 1,840.26 Russoll 2000 450.53 NYSE diary Advances: 2,117 New high Declines: 970 New lows 209 62 Unchanged: Composite volume: 1,539,557,790 Nasdaq diary Advances: 2,362 New hi9hs Lill Newtows.

Unchanged: 1,070 286 Volume: 1,960,702,600 (Si or mck (00) Last Chg 39.15 547996116 69 221 282575 99.14 334 94008 41.49 75940 51.84 -358 $2 or Chg Chg 1.12 912 Chg Chg -52 -172 Name Dry PE Last Chg Chg AMCON .12 5 5.13 .09 44.0 Alltel 1.32 27 52.46 1.34 AmrTrde 6.28 ArchDan 21 13.15 Autoweb .25 BerkHaA' 47 65450 -550 BerkHB 2176 -42 Brunswick .50 19.63 19.4 Buckle 12 18.75 1.75 8.8 BurlNSF 13 30.38 1.38 7.3 CmcFdl .28 22 30 1.77 14.7 ConAgra .90 18 18.24 Enron .50 52 58.10 1.30 Fiserv 32 44.73 Flemng .08 25.45 1.26 115.4 Goodyear 1.20 92 23.85 3.7 ISCO 863 23.2 Kellogg 1.01 29 27.03 .75 3.0 KlndMorg .20 40 53.20 3.40 1.9 LeeEnt .64 4 30.45 .95 2.1 .35.28 17.38 4.00 39.72 40.95 11.65 8.00 16.50 26.51 .23 56.25 23.20 32.36 16.94 49.47 .25 3.42 .04 .25 1.38 0.01 3.61 2.65 3.16 .78 4.04 48.7 3.6 2.3 10.8 4.4 .10 29 ,36 13 10 .68 11 .441 43 .92 13 1.72 .28 33 .80 15 .751 18 1.20 15 .28 13 .96 21 Molex NashF NatlResn ParkHan Pfizer Ptonlrtt PrmEgy ProFac pf Sysco Transcrypt UnlonPac USBancrp UtilICo Valmnl WellsFrgo Diary 505 Advanced 359 Declined 55 New Highs 92 New Lows 938 Total Issues 74 Unchanged Diary, Advanced Declined New Highs New Lows Total issues Unchanged Volume 2,164 1,182 246 134 3,429 83 7.479,368,800 Volume Advanced Declined New Highs New Lows Total issues Unchanged 2,240 2,155 187 577 4,761 366 9,964,644,708 600,968,200 Volume.