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marshall
New Member

1099-B Reporting the ROVI TIVO merger 09/2016

I am unsure how to properly report the TIVO/ROVI merger from Sept 2016.  Here is what my 1099-B shows:

Qty 125 shares @ 2.75/share, 1(d) proceeds $343.75

Qty 0.163 shares, 1(d) proceeds $3.50.

The TIVO stock was acquired around year 2000.  Not sure original cost, my brokerage website does not show trades that old.

What is the cost basis for the above transactions and what would the cost basis be for the "new" stock if/when I sell it in the future?

4 Replies
TomYoung
Level 13

1099-B Reporting the ROVI TIVO merger 09/2016

The cost basis of the TIVO stock acquired in 2000 is absolutely essential to know in order to derive a proper basis to use here.  If you used the same broker to buy that stock as was holding the stock they should be able to get that information for you.
marshall
New Member

1099-B Reporting the ROVI TIVO merger 09/2016

I found another area of the broker site shows me the older transactions. In the year 2000 I bought 125 shares @ 21.0625.  I never touched them.  Currently the broker shows I have 48 shares of the new TIVO stock (.3853:1).  Thanks for any help you can provide.
TomYoung
Level 13

1099-B Reporting the ROVI TIVO merger 09/2016

For convenience I used the same 15-day average price of ROVI/TIVO as the deal used to come up with the entire "proceeds" of your sale*:

$343.75 (cash) + (125 x .3853 x $20.6344) = $1367.55.  Subtracting your $2,633.13 results in a "real" loss of ($1,295.57) but because of the way the deal was structured you may not claim this loss.  Accordingly in your case you'll report a "basis" of $343.75 against the cash proceeds for no gain or loss.

Since you used up $343.75 of your basis your new basis in all the new TIVO stock, including the fractional share is $2,289.38.  You can use a basis of $7.72 against "cash in lieu" proceeds for a long term loss of $4.24.  You basis in the remaining shares is $2,281.65.

Tom Young

*You could justify using a higher per share FMV based on TIVO's trading range on the day after the deal, but it doesn't change anything; you still have a loss.






ka31
New Member

1099-B Reporting the ROVI TIVO merger 09/2016

Very helpful and clear answer Tom Young. Thank you so much. One follow up question: Why can't the $1295.57 loss be claimed as LT Loss in the year this merger was done in Schedule D, and leave the new shares (in this case new TIVO Corp stock) cost basis at the merger priced value (in this case $20.6344) for future sale records? This might make the new shares acquisition date as the merger year, I suppose? This alternate approach of claiming the loss seems cleaner, because it would decouple the taxes and makes it easier to track across years, right?

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