Prior to 2018, mergers involving stocks I held were exchanges of stock. Company A shareholders get X shares of Company B. Negligible impact on federal income taxes.
However, I saw in Jan 2018 a forced stock sale of all 200 BCR shares I held. In exchange, I received $223.95 per share plus 101 shares of BD plus cash in lieu of fractional share. All this is consistent with BD investor FAQs. http://investors.bd.com/phoenix.zhtml?c=64106&p=irol-BardFAQ
The BCR stocks were acquired in 1986, so the basis is low and the cap gains hit is painful. If I'd been paying more attention to BCR investor news, I would have seen this coming in mid-2017.
What kind of merger/acquisition is this called where stocks of the company being acquired are sold not exchanged for shares of the acquiring company? I'd like to pay better attention to my other stocks.
Thanks, hope my question makes sense.
not sure there is a name for it, but anytime there is a cash component to the merger, there are tax implications as you can't control the fact that you are giving up some of your stock for cash.
when there is an 'all stock' deal, there typically are no taxes to be paid (but that is not an absolute) because you are trading stock for stock and don't receive cash.