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mergers fees and tax basis of stock

 

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Subject Author Date
mergers fees and tax basis of stock David Zelinsky 05-03-2008
Posted by David Zelinsky on May 3, 2008, 6:25 pm
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When a stock I own is subject to a merger or spinoff, the brokerage
which holds the securities charges a $20 "mandatory reorganization
fee". What is the tax treatment for this fee? Do I add this amount
to the tax basis of the stock, as with the commission on a purchase?

-David

========================================= MODERATOR'S COMMENT:
Yes, since it is a fee associated with that particular transaction

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Posted by Benjamin Yazersky CPA on May 4, 2008, 7:29 am
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> When a stock I own is subject to a merger or spinoff, the brokerage
> which holds the securities charges a $20 "mandatory reorganization
> fee". What is the tax treatment for this fee? Do I add this amount
> to the tax basis of the stock, as with the commission on a purchase?
>
> -David
>
> ========================================= MODERATOR'S COMMENT:
> Yes, since it is a fee associated with that particular transaction
>




the $20 fee gets added to the basis of the stock



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<< ------------------------------------------------------- >>
<< 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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