In 2021 a company I own ADR shares in (SK Telecom from South Korea) had a stock split and a month later spun off a subsidiary. The subsidiary was not available as an ADR so apparently the way to resolve this was to pay US holders for it instead, they called it "redemption of unissued rights".
After the payment to me went through the market value of my holdings dropped by the amount I received in cash.
Charles Schwab reported this on a 1099-B and reported the payment as a short-term gain with cost basis missing.
It seems pretty rude that when I add this to my Schedule D it comes up as a short term capital gain and the entire amount is taxed as ordinary income. If I sell the shares now all I get is a credit against other capital gains of 15%.
What am I missing? Can I instead input the cost basis myself as the amount I received? Schwab is of no help.
