This pertained to an investment in a private company that was sold (merged with) a public company. The merger and sale agreement contemplated 10% of the sales proceeds as "holdback" to be distributed one year later after satisfaction of certain conditions included in the purchase and sale agreement. The original gain was short-term in nature (April purchase and September sale in same year) but the holdback was distributed 12 months later.
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The issue is how long you held the asset. If you held the asset one year or less, the gain is short term - regardless of when the proceeds were distributed.
https://www.irs.gov/taxtopics/tc409.html
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