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If you have data to enter for Box 9 from Form 1099-DIV Dividends and Distributions, review your return by running the Double-Check feature. There will be a Yellow warning titled Warning: Form 1099-DIV - Liquidation Distributions which will provide additional information.

Generally, when you receive distributions of your stock from a liquidating corporation, you will recognize a capital gain or loss and would need to report this on Schedule D (Form 1040) Capital Gains and Losses. However, if the corporation is distributing payments to you over a period of years, the gain is not reported (or recognized) until the distributions exceed the adjusted basis of your stock. If the distribution is less than the basis of your stock, you would report a capital loss after you have received the final distribution.

To report a capital gain or loss on Schedule D:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
  2. Click Investment Income in the Federal Quick Q&A Topics menu to expand, click Gain or loss on the sale of investments to expand, then click Capital gain or loss (Form 1099-B).
  3. Click + Add Form 1099-B to create a new copy of the form or click Edit to review a form already created.
  4. Click Quick Entry to scroll down to answer all applicable questions or click Step-by-Step Guidance to proceed with the program interview questions.

For additional information, please refer to IRS Publication 550 Investment Income and Expenses (Including Capital Gains and Losses).

Note that any link in the information above is updated each year automatically and will take you to the most recent version of the document at the time it is accessed.


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