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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 13339
Experience:  15years with H & R Block. Divisional leader, Instructor
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This is a tax questions. As a result of the Coca Cola merger

Resolved Question:

<p>This is a tax questions. As a result of the Coca Cola merger in Oct. 2010, I received a 1099B statement claiming I has a Realized gain of $3000. Is this taxable? The description says 300 shares Coca Cola Enterprises proceeds 4745.69 original cost 1745.69 gain 3000. on another page it says MERGER. But I didn't sell my shares and I don't have the 3000. Maybe my stock broker has it Can you help me determine if I gave to pay tax on the 3000?</p><p>I need a tax expert, not a certified auto dealer</p>
Submitted: 5 years ago.
Category: Tax
Expert:  Robin D. replied 5 years ago.

Robin D :

Hello and thank you for using Just Answer

Robin D :


In general, the receipt of shares will be tax-free, but all or a portion of the cash you receive will be taxable to the extent you must recognize gain on the transaction . Cash received in the transaction is generally treated as being received in exchange for stock given up and any taxable gain will normally be treated as a capital gain.



The gain, if any, is determined by first calculating your gain realized. This amount is equal to the fair market value of New CCE shares plus cash you receive in the exchange, minus your tax basis in Old CCE shares given up in the transaction. The gain recognized is determined by comparing which amount is less – the cash or the gain realized.


The fair market value of the New CCE shares you received is the average of the high and low sale prices of New CCE common stock on the New York Stock Exchange on its first day of trading (October 4th, 2010). The high was $22.50. The low was $21.66. The average of the high and low is $22.08.


Robin D :

You did not have to sale your shares. The merger changed the shares you had into the NEW shares.

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