Level 1
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Investors & landlords

My mom passed in 2014 and my sisters and I inherited/split the stocks when the estate was closed in 2016. 
Filling in the blanks, I was asked if Federal was withheld and Turbo stated that as an "unusual" event.
Entering all the info was actually satisfying as I understood UNTIL I didn't!
It has raised my total gross income by THOUSANDS and is trying to give me a VERY LARGE Federal refund.

Although that would be great, it doesn't seem to make any sense.
I did NOT sell these stocks
Because it says QUANTITY SOLD, who sold them and more importantly, where or to whom was it sold?

Thank you in advance!!!


Level 11
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Investors & landlords

I am sorry for your loss.

Thank you very much for providing those screen shots. Too often people don't give us the detail needed.

That said, can you clarify who received those 1099-B's? You or your mother? or your mother's estate?

It is very unusual for tax to be withheld on a 1099-B especially if all that happened was the transfer of shares from your mother's name to your name as part of closing the estate. That is generally not a taxable transaction until you sell the shares in your own account.

Perhaps you should call the financial institution and ask them, especially about the 1099 that indicates "sold." Or check you statements/online account to see what happened on 9/02/2016 and 9/23/2016.
Level 1
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Investors & landlords

Recipient's name is me.
That was actually the 1st thought I had when I woke up this morning that maybe it was her.
Thank you!
I will call them and check online.
Level 11
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Investors & landlords

Your basis in the stocks would be the average of the high and the low FMV for each stock on the date of your Mother's death.   You will need that for the non-covered shares...and perhaps for the covered shares as well.

Very interesting as to the amount of withholding also, greater than 25% of the gross proceeds.

You really need to talk to the broker and find out exactly what was sold, what wasn't sold, and if you didn't authorize a sale of the stock; why were they sold?

Were you the executor of the estate?

How were the stocks split?  Did your sisters sell their shares; were all the stocks sold and then some reinvested?

If these truly are your shares of stock and were sold without your authorization, there is something not right going on.
Level 1
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Investors & landlords

My sister was the executor of the will and she had the stocks split 3 ways and not 1 of us has touched them.
I have been busting my brain cells for 1 solid week (using online programs, Googling the question not to mention the anxiety) that I must not have had 1 left to figure out who to call!
I have had the same accountant for 9 years and he "fired" me (I'm assuming because I did my own last year(?) so he won't even look at my forms I sent him and offered to pay him for.
He does my sisters taxes which may have helped but she hasn't even sent them in yet.  
These are at Wells Fargo Share Owners Services and I didn' think they'd be open today but when they answered, it said there would be quite a wait as they were very busy.
I wasted a few minutes pushing buttons when prompted to finally get the message that they were in fact, not open.

I SO appreciate the replies!!!
I was so happy at the ease of using this program and this has just boggled my mind!
Level 1
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Investors & landlords

I just want to add that the estate was closed on 9/9 and the 1st stock was sold on 9/2. (?)
The 2nd was acquired on 9/2 and sold on 9/23.
(Notice that 1 says merger and the other says sales to the very right.)

I don't know anything about stocks so what, if anything is presented, could I look for when accessing the online account?

Thanks again!
Level 1
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Investors & landlords

Update. My sister got a letter in the mail that neither my other sister nor I got.
I have to send this in a message from my cell  because my computer broke down yesterday while I was doing my taxes.
I hope I correct all typos prior to sending!

Dear former Johnson Control Inc shareholder,
The merger of Johnson Controls Inc and Tyco International PLC was completed on September 2nd 2016.
Shareholders of Johnson Control Inc as of the close of business on September 2nd 2016 received ordinary share and or cash of the combined company Johnson Control International PLC in exchange for Johnson Control Inc common stock.
The receipt of combined company ordinary shares and or cash is a taxable transaction for United States federal income tax purposes.
Wells Fargo Services has not determined whether you are entitled to the sale or exchange treatment pursuant to section 302 of the Internal Revenue code in light of your particular facts and circumstances with respect to any portion of the merger consideration treated as a distribution.
All shareholders are urged to consult with their Tax Advisor as to the particular consequences of the exchange of Johnson Controls Inc common stock pursuant to the merger.

I am absolutely beside myself!
What is a Tax Advisor?
An accountant?
I don't have an accountant.
Why would an accountant know anything about whether or not we are "allowed" to have the stock?
I would assume you would actually call Wells where the stocks are or the Johnson Controls stock.
Also, this happened on September 2nd and we close the estate on September 9th.
I may be completely wrong but it almost sounds like they gave us money the way it sounds on the beginning of the letter.
We got monthly dividends of about $20 for about three or four months but that was it.(?)
And last but not least, why would we not be entitled to have these shares if we inherited them?

I just don't understand any of it.
I hope somebody can shed a little light on this for me please?

Again thank you in advance!
Level 11
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Investors & landlords

A tax advisor is simply someone who knows enough about tax law to advise how that law applies to your particular situation. Examples include a certified public accountant (CPA), tax lawyer, or enrolled agent (EA). 

In this case you received either stock and/or cash as a result of the merger. Section 302 of the tax code (see https://www.law.cornell.edu/uscode/text/26/302) is about whether or not that redemption of stock in exchange for new stock and/or cash is taxable as a sale or not. 

This is complicated and I would suggest that you should seek the guidance of a CPA, EA, or tax lawyer to apply the law to your case.

You can always file an extension and you will have plenty of time to find someone before the extended October 15th filing deadline.

View solution in original post

Level 1
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Investors & landlords

Thank you for your help!!  🙂
Level 11
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Investors & landlords

I would consult a tax advisor.  this is too complicated for an Q&A forum.

One note, if you file for an extension of time to file your return, please note it is not an extension of time to pay taxes. Form 4868 is used to file for an extension for F1040.

You would need to estimate your total tax liability and your payments, and possibly need to send in money with the F4868 so that later, you wouldn't have a penalty for underpayment of tax.

Level 1
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Investors & landlords

UPDATE~
The warning letter meant nothing so said Wells.(?)

Went and talked with a tax pro yesterday and they gave me the input amount to enter on Johnson Controls Inc. under column Box E.
That was the Cost or other Basis the day of my Mom's death.
He has assured me that will raise my total gross by about $800 rather than the $12,000 I kept getting.

VERY confusing problem with a VERY simple answer.......
Extremely UNfair!!!!!
Level 11
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Investors & landlords

Glad you found the professional advice you needed.
Level 1
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Investors & landlords

All thanks to you!!
I wanted to recommend ALL of the answers but only allowed me one~Not that that was the answer I most favored in any particular order as they were all put into consideration and appreciated!!

I'm positive my question, along with all of the answers, will help somebody else if not now, in the future.
Although complicated, I just can't believe I'm the only 1 this has happened to.
Then again, it wasn't Google~able (?) so "leave it to me" is what I can assume which doesn't surprise me in the least!!
Level 1
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Investors & landlords

jtax~I have 1 more question for you (or anyone that can help)~

I thought I was all set once I got the cost of the stock.
Like I said, it increases my total net by $800 instead of $12,000.

What has me worried NOW is the fact that once I enter this (and the other 2 stock numbers), I am getting a Federal refund of $4,700-ish.
Can that be possible??
Had I not had these stocks, I was prepared to OWE the Federal about $1,000 as I did not make quarterly payments last year.
So that makes this refund even HUGER.

The image I am referring to is the 1 above, on the LEFT.

Thanks again, in advance!!!

Explanation~~
Had I known this when I was given the cost, I would have asked then.
The person that helped me find the cost was a financial adviser that worked with me as I was planning on transferring these stocks to his company.
He did say it would raise the refund a bit.
A "bit" can be looked at many different ways depending on whose wallet that "bit" enters. 🙂
Because I have made some costly decisions in other areas of my life this week and wasn't confident in making any more, I canceled today's meeting @2:00.
Not sure he'd be happy to assist me with this additional question.
Level 1
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Investors & landlords

PS~The amount I was given to enter under Box 1e-Cost or other basis is~$14,943.60.