schedule d question for company buyout

Discussion in 'US Taxes' started by zikester, Oct 3, 2008.

  1. zikester

    zikester Guest

    I purchased stock in a NYSE-traded company A that was later bought out
    by another NYSE-traded company B. In the process, company A's shares
    were converted to company B's shares.

    1) When I sell my shares in company B, how do I notate that there was
    a conversion of stock?
    2) How can I verify what the actual conversion rate was? The
    conversion happened in 2004.
    3) Do I need to provide official documentation in my tax return to
    substantiate that conversion rate?

    Thanks!

    Isaac
     
    zikester, Oct 3, 2008
    #1
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  2. If you simply traded in your shares of A for shares of B, the total
    cost basis and acquisition date of B is the same as for A. This assumes
    the company has a ruling that this was a tax free exchange.



    If you received cash as part of the deal, it is more complicated and
    contact the company for information on figuring your cost basis and
    gain/loss on A.


    As for record keeping, save the information they sent you. No need
    to send it to the IRS unless they ask.
     
    Arthur Kamlet, Oct 3, 2008
    #2
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