Super Mom: How do I complete a 1099-B?
Hello. I work for a domestic company who fired a 2% shareholder. The company then purchased his remaining shares for a total of $ 10K. I need to report this on a 1099-B but have no idea. I understand area 1-5. Anyone know about #6 (classes of stock exchanged)? I’m thinking blank because no stock was “exchanged” only purchased.
Really usure about 8, 10-11 (profit/loss, unrealized profit, aggregate profit).
Extra points to anyone who can tell me why the IRS makes filling out these dang forms so difficult.
I respectfully disagree with “tax lady” and more agree with Bostonian in MO.
I found a tax code that states :”if we cannot determine if we fall under 301 or 302, we should provide a 1099-B.”
We don’t know if we fall under 301 or 302, so we, as an S corp, should file a 1099-B.
Answers and Views:
Answer by Bostonian In MO
Keep it simple. Assuming that this was simply a straight share buyout, put the amount you paid him in box 2 and leave it at that.
Box 5 would be blank on a cash buyout. Boxes 8 – 11 are for certain open regulated futures contracts and foreign exchange contracts. Again, on a straight share buyout, they would be blank.
The only other box you need to concern yourself with would be box 4 if the payee was subject to backup withholding. You’d show the taxes withheld there. Most payees are not subject to backup withholding so you would not withhold any tax.
Answer by the tax ladyI’m curious. You use the phrase 2% shareholder which tends to be synonymous with an S-corp, yet your other post mentioned issuing a 1099-DIV which only applies to a C-corp. What are you?
I also don’t know why you are issuing a 1099-B if you are not a broker in the securities industry. The instructions for the form state not to issue the 1099-B if
–You are a corporation that purchases odd-lot shares from
its stockholders on an irregular basis (unless facts indicate
otherwise),
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