Return of capital

Nadine DeVoss on

Our club owned Grant Prideco when it merged with National
Oilwell Varco. As a result of the merger the club received
$2320 as return of capital. Our 1099 from the broker lists
this return of capital in Box 1 and the amount is included
in Box 2, aggregate return of proceeds. Our capital gain &
loss report does not include this amount in our total sales.
Do I need to address this discrepancy anywhere before I
continue with our tax return?

Nadine
Compeer Investment Club

iras1 on

Absolutely!!! This is a stock and cash merger. You have to determine how much, if any, of the cash received is return of capital and how much is capital gain. You then have to make the appropriate entries in bivio. I don't know if AccountSync will automatically run the calculations for you. Contact support@bivio.com to find out. Alternatively, instructions for doing the calculations yourself can be found here: http://www.iclub.com/support/kb/default.asp?page=kb_1246 The software instructions are for ICLUB's accounting products, but the analogous data entry steps for bivio are obvious.

Ira Smilovitz

In a message dated 02/10/09 09:46:14 Eastern Standard Time, nadine51503@bivio.com writes:

Our club owned Grant Prideco when it merged with National
Oilwell Varco. As a result of the merger the club received
$2320 as return of capital. Our 1099 from the broker lists
this return of capital in Box 1 and the amount is included
in Box 2, aggregate return of proceeds. Our capital gain &
loss report does not include this amount in our total sales.
Do I need to address this discrepancy anywhere before I
continue with our tax return?

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