Should I be paying taxes on nondividend distributions beyond cost basis

[JugarBoliche]

In 2019 I received a dividend payment. On the 1099-DIV a large portion of this was listed in Box 3, nondividend distribution. I believe the amount exceeds what I originally paid for the stock. TurboTax states that Box 3 has no impact on taxes and is just there to match the paper form, which seems true except ones the amount exceeds the cost basis. IRS Publication 550 provides an example in the section on Nondividend Distributions (pg 20-21 Example 2) where it shows Nondividend distributions $1 more than the cost and states "You reduce your basis in each share to zero and report $1 of gain. See the Instructions for Form 8949 for details and more information."

It makes it sound like Capital Gain taxes should be paid this tax year on that $1 (even though nothing was sold), but form 8949 that it points to only asks questions about items that are sold for calculating Capital Gains.

Should I be paying capital gains taxes on this excess amount this year, or would I be paying it at a later date, when the stock is sold? If so, how can I enter it in TurboTax? 

[Rick19744]

See the attached form 1099-DIV and the instructions for box 3.

Based on your limited facts, the amount should be taxable.

If it is taxable, then you would enter this on form 8949 and Sch D just like any other stock sale.  It would be taxable in the year the distribution exceeds your stock basis.

Having said that, I don't know the history behind this investment, but it would seem to be limited situations that you would receive a return of capital that exceeded your investment.  Just make sure you are confident in your stock basis computation.

https://www.irs.gov/pub/irs-pdf/f1099div.pdf

[JugarBoliche]

Thank you very much, I think the statement on that form you pointed to was the clear confirmation I was looking for. I will just use the date of the payment as the "sale date" and the excess above the cost basis as the proceeds.

I had tried to post a more detailed version of the question that got marked as spam for some reason, but the point about being sure on the cost basis is also something I am trying to figure out. These stocks were acquired through a couple of "transactions", so there is also a chance my Cost Basis isn't accurate. I originally was given stock options, which I exercised and purchased the stock. There was then some corporate reshuffling where my Class B stock was converted into Class A stock and Class B stock, and I was given the chance to buy additional Class B stock. In the "conversion", almost all of the capital of my original stock value was applied to the new Class A stocks that were issued, with the exception of $0.10/share for Class B, and the additional Class B stock was also made available at $0.10/share. 

Since the dividend payment in this case was only on Class B stock, I am assuming my cost basis was $0.10/share.