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    IllinoisChip's Avatar
    IllinoisChip Posts: 6, Reputation: 1
    New Member
    		  
    #1

    Feb 12, 2008, 10:21 AM
    Cash in lieue of stock for partial share of Kraft Foods spin-off
    Last March when Kraft Foods was spun out to the shareholders of Philip Morris they gave out 0.692924 shares of KFT for each share of MO, and cash in lieu of stock for any fractional shares. My understanding is that I should treat the cash as if I had sold the fractional share, which means treating it like a long term capital gain. However, when I received my 1099-B statement from my broker it does not include this transaction. Now if I report the cash in lieu of stock as a sale on schedule D then the sum of all transactions won't agree with the 1099-B form. Any advice on how to handle this? Any idea why this was not included on the 1099-B? It's only $19.33, but I want to get it right. Thanks!
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #2

    Feb 27, 2008, 10:48 AM
    Then your broker screwed up, because you DO have to report the transaction on Schedule D.

    I have had clients returns audited because they failed to include these very small stock transactions on their tax return. That's silly, I know, but its HAS happened.

    List the transaction on Schedule D. Even if you show a basis of ZERO, it likely will not even affect your tax refund at all.
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