1099-Div

[Wheel87]

I have a client that received a 1099-Div with an amount in box 9 for cash liquidation.  His father owned this corporation and had passed away.  My client received the full amount and then wrote checks to his siblings for their share.  The only nominee requirements I found in Pub550 only mentioned ordinary dividends and that cash liquidations are treated as capital gains.  Being that this is inheritance, will this be taxable, and if not, would I just include a statement on the return stating the facts? If taxable, looks I would put it on as capital gain for his portion only along with a statement with details.  I guess my questions are: is this a taxable transaction and does he have a requirement to issue 1099's to his siblings.  I would appreciate any direction and guidance on this.  Thank you in advance. 

[BobKamman]

Report it as proceeds on Schedule D (if this is total amount expected to be received) and use FMV at date of death as cost basis -- perhaps difficult to determine exactly, but easy to guess.