As part of a merger between BHI/GE, 1 share of BHI received
1 share of BHGE & a special dividend of $17.50 per share on 7/6/2017 as
regular taxable dividend income with no return of capital component. This cash
component is reported by broker as dividend on 1099-DIV. There is no 1099-B.
The original cost of buying the 1000 shares of BHI was $68,000 or $68/share. By
the time the merger was completed in July 5, 2017 and the BHI stock price had
dropped to $53. It resulted in a cash dividend of about 17.50 / share and 1
share of BHGE at $33. How should I account for the cash dividend? And the “loss”
incurred because of the transaction.
