Box 9 shows cash liquidating distributions that you receive during a partial or complete liquidation of a corporation. These distributions are considered a return of capital. Liquidating distributions are not taxable to you until you have recovered the basis of your stock.
Once the basis of your stock has been reduced to zero, then you have to report the liquidating distribution as a capital gain.
If the liquidating distribution shown in Box 9 is a complete liquidation, then report the amount in Box 9 as a stock sale. Please follow the steps below to report the event:
- Open or continue your return in TurboTax if it isn't already open.
- Search for investment sales and then select the Jump to link in the search results.
- Answer Yes to the question Did you sell stocks, mutual funds, bonds or other investments?
- If you land on the Here's the investment sales we have so far screen, select Add More Sales.
- Following the instructions and we'll calculate the gain or loss from the sale.