[Z-man]

So, my friend (no, really) recently inherited a large amount of shares of two blue chip stocks. She wants to diversify these stocks, but has run into an issue regarding taxes. I don't know the tax laws enough to offer a good answer, so I'm reaching out to the Pelican brain trust for input...

If I understand this correctly, if she sells any of these shares, she has to pay capital gains tax on the profits (current value minus purchase value). However, she does not know what the price of the stock was when it was originally purchased.

The questions:
So how does she calculate how much tax to pay when she sells shares? Does she use the value of the stock on the day she inherited the stocks as the starting point?
If she reinvests in the market, does she still have to pay the capital gains tax?
What other options does she have?

Thanks guys...