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Is it okay to report taxpayer proceeds with a cost basis of zero?
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Yes there is no cost basis
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@IRonMaN Makes you wonder, doesn't it? Could be one of those stocks that made nontaxable distributions greater than what the shareholder paid for it. Or maybe a piece of real estate with an easement sold long ago, for more than the basis.
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The actual basis there is zero.
I was talking about those small dollar ones. You ask the client about basis. They have no idea. I say, OK fine, we use -0-. It's not worth anyone's time to research.
The more I know the more I don’t know.
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@PATAX and @sjrcpa Zero basis for demutualization? That's what IRS would have you think. The wealthiest man in Arizona (Campbell Soup heir) went to court and the judge saw it differently. Your results may differ.
https://www.journalofaccountancy.com/issues/2013/jun/demutualization.html
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@BobKamman Thanks Bob, that is a good article.
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I sort of remember that but thought -0- basis was the position now. I'd certainly research it if/when it next arises.
The more I know the more I don’t know.