|
Posted by granny44 on July 13, 2007, 5:18 am
Please log in for more thread options
BACKGROUND:
St. Paul Companies, Inc. was successfully sued in a class
action case on the allegations that claimants were induced
into buying their shares or exchanging Travelers Property
Casualty Corp. shares for their shares based on false
statements that inflated the share price. The settlement was
calculated by determing the effect of the false statements
on the share price [i.e., on the difference between the
share price with and without the false statements].
Claimants' settlement amounts were based on the price
difference times the number of shares they owned. The
settlement has been determined to be a "Qualified Settlement
Fund" per Treasury Reg. 1.468B. The settlement is being paid
in July, 2007.
QUESTION:
For Federal income tax purposes, how is this settlement to
be treated by an individual investor who holds the shares as
a Capital Asset?
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ------------------------------------------------------- >>
| 
Yahoo! 
Google 
Windows Live 
del.icio.us 
digg 
Netscape 
XML Sitemap