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Would this distribution be taxable or non-taxable?

  
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Subject Author Date
Would this distribution be taxable or non-taxable? 0b3hks001 04-22-2008
Posted by 0b3hks001 on April 22, 2008, 1:40 pm
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 A corporation is "reducing the nominal value of the registered shares
by $0.48 per share; and use the nominal value reduction amount for
repayment to the shareholders".

Would this distribution be non-taxable (i.e. reduction of basis)? Or
taxable? If taxable, would it be a dividend or capital gains
distributions?

TIA

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Posted by removeps-groups@yahoo.com on April 22, 2008, 9:38 pm
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 On Apr 22, 10:40 am, 0b3hks...@sneakemail.com wrote:

> A corporation is "reducing the nominal value of the registered shares
> by $0.48 per share; and use the nominal value reduction amount for
> repayment to the shareholders".
>
> Would this distribution be non-taxable (i.e. reduction of basis)?  Or
> taxable?  If taxable, would it be a dividend or capital gains
> distributions?

It sounds like a return of capital to me, but I could be wrong. Did
you ask management whether it is a return of capital, dividend, or
capital gain?

--
<< ------------------------------------------------------- >>
<< 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. >>
<< ------------------------------------------------------- >>

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