![]() ![]() ![]() ![]() You can also read previous issues of our online newsletter on this website. The March 2022 issue of Tax Policy News is now available. FEES CHARGED FOR SMALL BUSINESS TAX RETURN DOWNLOADYou can also download a Local Jurisdiction Tax Rate file. Through our Sales Tax Rate Locator, you can now download a comprehensive dataset of Texas addresses and associated state and local sales and use tax responsibilities. New Sales Tax Rate Locator Services Available Learn more about local tax sourcing changes to Rule 3.334, Local Sales and Use Taxes. For more information, see the E-cigarette Retailer Permit or Frequently Asked Questions webpage. An e-cigarette retailer must also have an active Texas sales tax permit. 1, 2022, per Senate Bill 248, 87th Legislature. In contrast to a mandatory reorganization fee, a voluntary reorganization fee allows you an option.E-cigarette retailers who intend to sell, store or make delivery sales of e-cigarette products to consumers in Texas must apply for an e-cigarette retailer permit by Jan. As with stock reorganization fees, the aforementioned fees are not deductible. Other corporate actions such as dividends declared, mergers, acquisitions of other companies, stock splits, spin-offs, and rights issues, may also involve fees. Sometimes when there is a reorganization mandated by the issuer of your stock, you will also be charged the fee as stockholders have no choice and this reorganization is required for all outstanding shares. A mandatory reorganization fee can involve a cash merger by a company, or a reverse stock split. Reorganization fees are either mandatory or voluntary. Stock reorganization fees should not be confused with investment interest expenses which are sill deductible as an itemized expense. Prior to the Tax Cut and Jobs Act, such fees were deductible under schedule A as miscellaneous itemized deduction subject to 2% of AGI limit. Investment fees, such as a stock reorganization fee, are no longer deductible. No, a stock reorganization fee is not deductible. The main question is whether stock reorganization fees should be considered a sales expense or an investment expense, and I'm looking for guidance on this. Checking this option shows a new field labeled "Sales Expenses Not Reported By Broker" to enter an amount. So it doesn't list stock reorganization fees in the examples (I realize this doesn't necessarily mean that it's not a valid example, but if it was listed as one, it would definitely provide clarity). This includes any expenses you paid on the sale that are not already subtracted from your net proceeds (Box 1d) or added to your basis (Box 1e) and listed on Form 1099-B or substitute broker's statement. There is a link for "sales expenses" that opens a popup that states: I have the Turbotax Deluxe CD version, and when I try going thru the "uncommon situations" flow for the merger related stock sale, there is an option for the stock transaction that says "I paid sales expenses not reported by my broker. It cannot be considered both an investment expense and a sales expense. sales expense) and added to the cost basis? The "best answer" in this thread from saying that it's considered an investment expense (that used to be conditionally deductible in Schedule A, but no longer is starting in tax year 2019). from IRS) that stock reorganization fees can be treated like a stock trading fee (i.e. The other post doesn't mention anything specifically about stock reorganization fees. For these reasons, the IRS requires us to provide you with this reminder: Taxpayers are ultimately responsible for the accuracy of their tax returns." So basically, they are saying the amounts on the 1099-B might not be right. There may be instances where our reporting requirements will not be consistent with your particular tax accounting position or elections. But the 1099-B also states "You should review this information carefully when completing your Form 8948 and Schedule D. So the reorganization fee was not applied to the cost basis being reported to the IRS. On the 1099-B that I received, it reported a small amount of proceeds due to a merger situation and also reported $0 for the cost basis of this. Is there any reputable source that has an answer for this question? Is it really considered an investment fee or can it be added to the cost basis of the stock? I can't find any definitive answer to what would seem to be a common question. I have the same question about stock reorganization fees. ![]()
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