Welcome Guest. Register Now!  



Reply
 
LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 04-02-2014, 08:19 PM
Junior Member
 
Join Date: Apr 2014
Posts: 3
Nondividend distribution

I got a nondividend distribution from a stock I owned. The stock that gave the distribution then was bought out by another company (both are REITs). Now I know that this reduces the cost basis of my original stock. But do I somehow report that nondividend distribution as a capital gain in the year the original stock was bought out or do I wait till I sell the stock of the company that bought the original stock.

Thanks for your time.



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #2 (permalink)  
Old 04-02-2014, 09:17 PM
Moderator
 
Join Date: Oct 2010
Posts: 5,258
Quote:
Originally Posted by Paw8s8 View Post
I got a nondividend distribution from a stock I owned. The stock that gave the distribution then was bought out by another company (both are REITs). Now I know that this reduces the cost basis of my original stock. But do I somehow report that nondividend distribution as a capital gain in the year the original stock was bought out or do I wait till I sell the stock of the company that bought the original stock.

Thanks for your time.
In the year the original stock was bought out.A nondividend distribution reduces the basis of your stock. It is not taxed until your basis in the stock is fully recovered. it is a return of your investment in the stock of the company.

When the basis of your stock has been reduced to zero, report any additional nondividend distribution you receive as a capital gain. Whether you report it as a long-term or short-term capital gain depends on how long you have held the stock.



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #3 (permalink)  
Old 04-02-2014, 09:35 PM
Junior Member
 
Join Date: Apr 2014
Posts: 3
xxxxxxxxxxx


Last edited by Paw8s8 : 04-02-2014 at 09:40 PM.


Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #4 (permalink)  
Old 04-02-2014, 09:42 PM
Junior Member
 
Join Date: Apr 2014
Posts: 3
Quote:
Originally Posted by Wnhough View Post
In the year the original stock was bought out.A nondividend distribution reduces the basis of your stock. It is not taxed until your basis in the stock is fully recovered. it is a return of your investment in the stock of the company.
I meant that the stock was taken over by another stock. I received no funds for the original stock, just shares of the new company who bought the original stock.



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
Ads
Reply



Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
IRA Distribution arnoldabrown IRA/Sep 1 12-23-2013 10:40 PM
NonDividend Distribution - How to apply on 1040 lbogatin Capital Gains 1 07-19-2013 11:17 AM
NonDividend Distribution - How to apply on 1040 lbogatin For 2013 0 07-18-2013 05:29 PM
annuity distribution bryanpt Miscellaneous 0 09-18-2010 01:45 PM
IRA distribution pflang IRA/Sep 0 06-24-2009 06:54 AM

Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 
Individual
 » Income
 » IRA/Sep
 » Medical
 
Corporations
 » Payroll
 
Forum for CPAs
 
Financial Planning
 
 
 

» Recent Tax Q&A
No Threads to Display.