How FIFO, LIFO and HIFO Change Realized PnL
Compare tax-lot selection methods before a partial stock or crypto sale and understand their effect on estimated realized gain.
The concept in plain English
A tax-lot planner assigns units sold to specific purchase lots and estimates realized cost basis and gain. FIFO uses the oldest lots, LIFO the newest and HIFO the highest purchase prices first.
Open Tax-Lot PnL PlannerA lot-order comparison is not a tax election
Enter lots in acquisition order, oldest first: FIFO and LIFO use row order in this planner. The tool calculates basis arithmetic but does not establish which units a broker actually sold. Specific-identification requirements, deadlines, asset rules and jurisdiction determine what can be reported. Keep execution and acquisition records, confirm instructions with the broker before the sale, and ask a qualified adviser about tax treatment. No holding-period or tax-rate calculation is included.
The same sale, different selected basis
Oldest lot: 10 units at $40. Newer lot: 10 at $60. Sell 10 units at $70, excluding costs.
Proceeds = $700. FIFO basis = $400 and gain = $300. HIFO basis = $600 and gain = $100.
HIFO produces a $100 modeled gain for this sale, compared with $300 under FIFO.
The remaining lots retain different bases. A lower modeled gain is not proof that a method is legally available or best overall.
Calculation method
Selected lots supply cost basis until the sale quantity is filled. Estimated realized PnL equals sale proceeds minus the summed basis of selected units.
| Input | Purpose |
|---|---|
| Purchase lots | Stores units and unit cost in your entered order, oldest acquisition first. |
| Sale quantity | Determines how many units require lot assignment. |
| Sale price | Calculates estimated proceeds. |
| Selection method | Orders lots by FIFO, LIFO or HIFO. |
Step-by-step workflow
- Enter each available lot with quantity and unit cost, ordered from oldest acquisition to newest.
- Add the proposed sale quantity and price.
- Compare FIFO, LIFO and HIFO estimates, then confirm allowed identification rules with a tax professional or broker.
Practical benefits
- Makes lot-selection differences visible before a sale.
- Supports partial-lot calculations.
- Processes sensitive position data locally.
Questions about Tax-Lot PnL Planner
What is HIFO?
Highest-in, first-out selects the highest-cost available units first, which may reduce the estimated realized gain in some situations.
Can I always choose any lot method?
No. Jurisdiction, asset type and broker procedures determine available methods and identification requirements.
Is the result tax advice?
No. It is an educational estimate. Confirm records and treatment with a qualified professional and the executing broker.
Sources and further reading
Examples are hypothetical and exclude costs unless stated. This is educational material, not individualized investment or tax advice. Read our methodology and risk disclosure.