I filed my taxes with the assumption that the liquidation distribution would be handled by TurboTax in the investment income section as the software noted it would. The cash liquidation distribution was reported correctly on Schedule B Box 9. However, my assumption that Turbo Tax accounted for the cost basis and relating gains, or would prompt a question was incorrect. There was never any follow up in the investment income section. The software clearly just ignores the cash liquidation distribution.
The liquidation distribution cost basis was not reported to the IRS - going from Yahoo (YHOO) to Altaba (AABA) and other name changes likely complicated the issue, but I can see that the basis is not being reported.
I had approximately $20K basis and the liquidating distribution was approximately $30K, so it would appear I should report the $10K gain, presumably as a long-term capital gain? Additionally, future distributions would be handled as gains as there will be no basis left, is this correct? At this point, I would surmise that I will have to amend my return to report this $10K capital gain, is this correct? Or, could I wait until the final liquidation distributions are made and report the entire gain at that point in time?
It seems that TurboTax should fix this issue as I have traditionally had good luck importing my investment data directly from my broker and TurboTax handled it correctly, or at least would alert to the fact that something else needs to be done. In this case, I only spotted it after I submitted my return, which is unfortunate.
Thanks
