read the following and you'll realize that your tax basis is probably not zero. you should have received from the insurance company documentation as to the tax consequences of demutualization including how to calculate your tax basis. if not, I would suggest going to its website and looking for information in the investor relations section. if you can't find anything then there should be a phone number to call.
That court held that the Dorrances had basis in the stock they received through the demutualization of the insurance companies (Dorrance, CV-09-1284-PHX-GMS (D. Ariz. 4/19/13); see earlier coverage, The IRS had argued its long-standing position that stock received in a demutualization necessarily carries a zero basis. The court rejected this argument, concluding that the Dorrances had basis in their membership rights because they had paid premiums for policies that included policy rights and mutual rights, and that they had basis in the stock because they exchanged those membership rights for the stock.
