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AT&T/WBD spinoff -- reporting fractional shares payout in TurboTax
My wife inherited two shares of AT&T stock (T) on July 29 2004 with a cost basis of 19.25 and has held onto them since for sentimental reasons.
At End of Day on April 8 2022, the AT&T stock split into AT&T and Spinco stock, and each share of Spinco was converted to 0.241917 Warner Brothers Discovery (WBD). Since that came to 0.48 shares WBD, Computershare sent my wife a check for $11.53 instead of fractional shares. She received no 1099-B or other form, but just the check with a one sentence description of the transaction.
I used the AT&T worksheet here, that shows the post-close "aggregate basis" of the 0.48 fractional WBD shares is $9.04 and of the 2 AT&T shares is $29.46.
1. Does that mean the realized capital gains is $11.53 - $9.04 = $2.49?
2. How do I tell TurboTax what happened here? We don't have a 1099-B to enter field by field.
3. Do we need to use the $29.46 as the cost basis for any future transactions involving the AT&T stock?
Thanks!
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AT&T/WBD spinoff -- reporting fractional shares payout in TurboTax
KenTheWhip,
Congratulations! You have done everything correctly and came the the correct conclusions. For the sale of the fractional share, simply enter it manually as a Box F transaction with the dates, cost and sales amounts. Done. I have had dozens of such cash-in-lieu payments over the years, including AT&T.
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