Reply To: 1099-B for partial shares from Honeywell Spin-off

Home Fairmark Forum Taxation of Investments 1099-B for partial shares from Honeywell Spin-off Reply To: 1099-B for partial shares from Honeywell Spin-off

#2419
haroldml
Participant

Thanks Kaneohe,

These cash in lieu of fractional shares is more trouble than it’s worth in my opinion, given the small amounts involved. This is what the 1099-B states: “Box 5: Non-covered Securities Transactions for which basis is not reported to the IRS and for which short-term or long-term determination is unknown by EQ Shareowner Services. You must determine short-term or long-term based on your records and report on Form 8949, Part I with Box B checked, or on Form 8949, Part II with Box E checked, as appropriate.” I read that, when cash in lieu of fractional shares is involved that the acquisition date of the original shares should be used. In this case, that would be the date the original Honeywell shares were acquired in the late-1970s I think it was. And, there are three different lots acquired on different dates. Since then, there have been several different transactions including the merger with Allied Signal. So, it seems to me that long-term would apply with the acquisition date as Various. However, because the amount involved is so small, classifying it as short-term Non-Covered doesn’t change the tax situation in this instance. For short-term, the date sold is shown on the 1099-B as 10/29/2018 but the date acquired is difficult to determine. Since the Direct Registration Account Statement lists October 26, 2018, I can use that date as the acquisition date.

Any other thoughts?

Thanks,

Harold