If you can confirm with the payer that this was a payment intended to be a return of capital then it could be considered a 'Nondividend Distribution'. A nondividend distribution is nontaxable because it is a return of capital. Also, this amount should be in Box 3, Form 1099-DIV. Talk to the company and inquire about this detail.
That being said, if this is not on your dividend statement or documents from the merger clearly identifying this as a return of capital, then you will pay tax on the qualified dividends under the capital gain tax rules.
@tc8751
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
