1099 B Cost Basis and Procedure

Forum|Forum|6 years ago
April 1, 2020
4 replies
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I had 100 shares of AABA (previously YHOO), on 09/23/19, the company issued a cash liquidation of $5150. The broker reported a wrong "Date Acquired" in Box 1b, and used a wrong original cost basis of $1359 to report a proceed of $3791 (= 5150 - 1359) in Box 1d, with a cost basis of 0 (1e). My actual original basis was $7180. Should I change the procedure to -2030 ( = 5150-7180), or change the cost basis from 0 to 5821 ( = 7180 - 1359). Thanks a lot.

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JohnB5677

Alumni - Intuit

Just so I understand. You paid $7180 for Yahoo. It was re-labeled AABA, and you got total proceeds of $5150. That would say that you had a loss of $2030. Is that correct, or am I missing a piece? Do you still have other stock in this transaction?

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tlzhuAuthor

Level 2

Thans a lot for your reply. Yes, you are right. I lost $2030. I don't have any other stock in the transaction. I got $5150 from cash liquidation distribution, not from sale. Since my broker assumed that the original cost was $1359 (which was the value when I transferred AABA to the current broker; the actual cost was $7850 when I purchased), they list the difference of $5150 and $1359 as total proceed in Box 1d, and brought the cost basis to $0, in the 1099B. There is a note on the 1099B, which says "Return of capital or liquidation distributions have reduced the cost basis of this stock to zero. When the basis of your stock has been reduced to zero, you must report the additional return of capital or liquidation distributions as capital gains."