I THINK I have an incorrect 1099 due to expired warrants

[JP106]

Hello.

I owned warrants in the SPAC PSTH.  On July 26, 2022 those warrants expired when the SPAC liquidated.

In exchange, the SPAC underwriter has issued CUSIP's to us via a trust (as I understand it) so that we could participate in a future offering they are trying to put together through a new investment vehicle.

All that is fine.  The problem is that IB is showing the warrants as a covered opening and closing transaction, with zero loss - even though I received no funds from the warrants expiration.  So I put a bunch of money into those warrant purchases, and got none in return upon liquidation.  (The stock I held in the SPAC, yes I got funds back, but not for the warrants)

If they had not shown the warrants on the 1099 as a covered transaction, I'd be able to carry that loss forward later.

Does anyone disagree with my perspective?

I suppose I still could carry the loss forward - and either use that basis for any future theoretical transaction for those CUSIP's held in escrow.  But this doesn't seem right.

IB is actually showing funds received equal to my cost basis when I received no such funds.  I'm hoping they come back with a better answer to me but I'm not optimistic as this is a complicated situation.

I'd appreciate any advice.

[GeorgeM777]

We don't know whether you could carry that loss forward because it is not clear at this point whether you have a realized loss.  You did invest in the warrants, but the information you received from the brokerage firm seems to indicate that your warrants (maybe they were similar to compensatory warrants)  were like an option in that they expired with neither a loss nor a gain.  Thus, depending on the type of document you received from your firm, if you have a reporting requirement, you can report the warrant transaction on your return consistent with the information obtained from the firm.  

As to what you own now, it is not clear to us whether the CUSIPs replace your original warrants or represent something else.  It appears that you may still have the option to invest in a future SPAC, perhaps on terms consistent with the original warrants.  Until there is a more definitive explanation as to what happened to the original warrants, it's not clear to us whether you have a realized loss.  

@JP106