I have an issue answering the question on "Did you buy this stock?" I've chosen "received it due the company merger..." (Dell bought EMC), it doesn't let me to continue

[agalushka]

It's a EMC/Dell merger. I had RSUs which vested immediately once deal has been sealed. They taxed this amount and gave me cash. I also received the VMware tracking stock, which I sold, 40 shares, appr. $47.5 each. I haven't received the 1099-B form and manually filling it out. The issue is described in my question.

[fxhussain]

Same scenario with the exception of not selling the DVMT ... would that make the DVMT taxable?

[TomYoung]

The EMC/Dell deal is a taxable deal.  Selling or not selling the DVMT is a separate issue.  See

<a rel="nofollow" target="_blank" href="https://ttlc.intuit.com/questions/3405510">https://ttlc.intuit.com/questions/3405510</a>

for a more comprehensive discussion of how to report the sale of EMC to Dell.

[TomYoung · Accepted solution]

Ticking that particular method really goes nowhere.  If you look closely at that page you'll notice that all that happens is a new paragraph shows up lower down on the page.

"If you received this stock as a result of a merger, spin-off, stock dividend, or similar corporate activity, please answer the question above with respect to the original stock you owned before the exchange."

TurboTax really can't help you here.

You're actually pretty luck here as you have 2 possible sales to report.  The first sale occurred when you sold your Dell stock for a combination of cash and VMware tracking stock.  ($24.05 in cash and .11146 shares of DVMT stock for each Dell share tendered.)  The actual income tax reporting of this sale is very complex and per the Form 8937 issued by Dell they are recommending a two-part treatment of the transaction consisting of:

• a Section 351 exchange for the Dell stock received and the portion of the cash provided by Dell
• A redemption of EMC stock for the cash provided by EMC

Dell believes that 86.77% of each EMC Share should be treated as exchanged in the Merger for $20.17 of cash and 0.11146 shares of Class V Common Stock subject to the Section 351 treatment.

So the only way to actually determine your gain or loss on this particular sale is the create a spreadsheet that can handle the complex calculations and derive some numbers that you'd then enter into TurboTax.  Luckily, you don't have to do that as I expect that you received no 1099-B for this sale.  The reason for that is two-fold:

1. Brokers don't have to create a 1099-B for a same day sale and
2. A typical same day sale creates a small loss due to selling commissions and fees.  (That's because your per share basis in the Dell stock is the per share "fair market value" Dell used to calculate the compensation reported on your W-2 for the vestings and, of course, a same day sale should realize per share proceeds pretty darn close to that same "fair market value".)

[REDACTED]

See https://ttlc.intuit.com/questions/3405510 for a comprehensive discussion of the EMC/DELL deal.

Tom Young