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BoA has made a lot of legal settlements lately. Is it this case? http://www.reuters.com/article/us-bofa-lawsuit-idUSBRE88R0PR20120928
You may not get a 1099-B if the amount is under $600. The problem is figuring out whether this should be treated as:
1. "because of the fraud, my BoA shares were worth less when I sold them" (the payment is short or long term cap gain depending on how long you owned the shares), or
2. "because of the fraud, BoA paid a smaller dividend" (in which case this should be taxed as a dividend), or
3. "because of the fraud, BoA is paying a simple penalty to former shareholders" (the payment is simple income)
Since the difference between LT cap gains (15%) and anything else (25% or 28% for most taxpayers) is not a lot of money for a payment of only $177, and because I'm not sure how to enter it in the program as a long term cap gain (you may have to play some tricks to get Turbotax to treat it that way), my suggestion is just to report it as miscellaneous income and pay your regular marginal rate.
If you really want to treat it LT cap gains to save the extra $20, I think one of the previous users can probably help you figure out how to get Turbotax to report it that way. It's probably fair to treat it that way, but I would want to read more about how the plaintiffs in the lawsuit alleged they were harmed--if they alleged loss of share price, that would make it an easier call for LT cap gains.
BoA has made a lot of legal settlements lately. Is it this case? http://www.reuters.com/article/us-bofa-lawsuit-idUSBRE88R0PR20120928
You may not get a 1099-B if the amount is under $600. The problem is figuring out whether this should be treated as:
1. "because of the fraud, my BoA shares were worth less when I sold them" (the payment is short or long term cap gain depending on how long you owned the shares), or
2. "because of the fraud, BoA paid a smaller dividend" (in which case this should be taxed as a dividend), or
3. "because of the fraud, BoA is paying a simple penalty to former shareholders" (the payment is simple income)
Since the difference between LT cap gains (15%) and anything else (25% or 28% for most taxpayers) is not a lot of money for a payment of only $177, and because I'm not sure how to enter it in the program as a long term cap gain (you may have to play some tricks to get Turbotax to treat it that way), my suggestion is just to report it as miscellaneous income and pay your regular marginal rate.
If you really want to treat it LT cap gains to save the extra $20, I think one of the previous users can probably help you figure out how to get Turbotax to report it that way. It's probably fair to treat it that way, but I would want to read more about how the plaintiffs in the lawsuit alleged they were harmed--if they alleged loss of share price, that would make it an easier call for LT cap gains.
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