Involuntary conversion of stock.

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Subject Author Date Involuntary conversion of stock. SD 08-04-2009   Re: Involuntary conversion of stock. Steve Pope 08-04-2009  Re: Involuntary conversion of stock. Alan 08-04-2009   Re: Involuntary conversion of stock. Steve Pope 08-04-2009  Re: Involuntary conversion of stock. DF2 08-04-2009  Re: Involuntary conversion of stock. Bill Brown 08-04-2009  Re: Involuntary conversion of stock. LoTax 08-05-2009  Re: Involuntary conversion of stock. SD 08-06-2009  Re: Involuntary conversion of stock. dpb 08-06-2009
Posted by SD on August 4, 2009, 2:54 pm Please log in for more thread options As far as I can tell from the pubs, an involuntary conversion of stock (i.e. a company buys out, via a tender offer, another company and then forced shareholders that did not tender their shares to sell), is not an involuntary conversion for tax purposes. Can somebody please tell me that I am wrong. -- << ------------------------------------------------------- >> << 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 (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Steve Pope on August 4, 2009, 3:09 pm Please log in for more thread options >As far as I can tell from the pubs, an involuntary conversion of stock >(i.e. a company buys out, via a tender offer, another company and then >forced shareholders that did not tender their shares to sell), is not >an involuntary conversion for tax purposes. Can somebody please tell >me that I am wrong. It's an involuntary conversion (Title 26, Subtitle A, Chapter 1, Subchapter O, Part III, Sectioh 1033), but since it's a conversion into similar property, under the General Rule it is not a tax event. Your basis and holding period are carried over to the new shares. Steve -- << ------------------------------------------------------- >> << 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 (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Alan on August 4, 2009, 3:26 pm Please log in for more thread options Steve Pope wrote: > >> As far as I can tell from the pubs, an involuntary conversion of stock >> (i.e. a company buys out, via a tender offer, another company and then >> forced shareholders that did not tender their shares to sell), is not >> an involuntary conversion for tax purposes. Can somebody please tell >> me that I am wrong. > > It's an involuntary conversion (Title 26, Subtitle A, Chapter 1, > Subchapter O, Part III, Sectioh 1033), but since it's a conversion > into similar property, under the General Rule it is not a > tax event. Your basis and holding period are carried over > to the new shares. > > Steve > I think he is saying that he did not tender his shares; the company making the offer was successful; and his shares were converted to cash. As such, it is treated no differently then any other sale of stock. -- << ------------------------------------------------------- >> << 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 (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Steve Pope on August 4, 2009, 8:43 pm Please log in for more thread options >Steve Pope wrote: >>> As far as I can tell from the pubs, an involuntary conversion of stock >>> (i.e. a company buys out, via a tender offer, another company and then >>> forced shareholders that did not tender their shares to sell), is not >>> an involuntary conversion for tax purposes. Can somebody please tell >>> me that I am wrong. >> It's an involuntary conversion (Title 26, Subtitle A, Chapter 1, >> Subchapter O, Part III, Section 1033), but since it's a conversion >> into similar property, under the General Rule it is not a >> tax event. Your basis and holding period are carried over >> to the new shares. >I think he is saying that he did not tender his shares; the >company making the offer was successful; and his shares were >converted to cash. As such, it is treated no differently then any >other sale of stock. Oops. Right, I misinterpreted it as an exchange. Steve -- << ------------------------------------------------------- >> << 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 (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by DF2 on August 4, 2009, 10:50 pm Please log in for more thread options In misc.taxes.moderated, Steve Pope wrote: > >>As far as I can tell from the pubs, an involuntary conversion of stock >>(i.e. a company buys out, via a tender offer, another company and then >>forced shareholders that did not tender their shares to sell), is not >>an involuntary conversion for tax purposes. Can somebody please tell >>me that I am wrong. If you got cash only, it's a sell. If you got something else, then it depends... > >It's an involuntary conversion (Title 26, Subtitle A, Chapter 1, >Subchapter O, Part III, Sectioh 1033), but since it's a conversion >into similar property, under the General Rule it is not a >tax event. Your basis and holding period are carried over >to the new shares. > >Steve -- << ------------------------------------------------------- >> << 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 (2007) - All rights reserved. >> << ------------------------------------------------------- >> Similar Threads Posted Weather related sale of livestock -Involuntary Conversion. 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