Interim Guidance Released on Issues Relating to the Basis of Stock Subject to Broker Reporting (Notice 2011-56)

Interim guidance has been released under Code Sec. 1012 on issues relating to the basis of stock subject to broker reporting under Code Sec. 6045, pending publication of superseding guidance. The guidance addresses public stakeholders’ requests for clarification and new issues they raised after final regulations governing basis and sales reporting by securities brokers were published (T.D. 9504; TAXDAY, 2010/10/13-1.3). The issues addressed in the guidance include: the change from the broker default average basis method; the ten-percent reinvestment rule and fractional shares; and lot selection methods across accounts.

Comments are requested on issues arising under this guidance. Comments should be submitted in writing on or before August 8, 2011, and should include a reference to Notice 2011-56. Comments may be submitted to CC:PA:LPD:PR (Notice 2011-56), Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, D.C. 20044, or electronically to Notice.Comments@irscounsel.treas.gov. “Notice 2011-56” should be included in the subject line of any electronic communications. Submissions may be hand-delivered Monday through Friday between the hours of 8:00 a.m. and 4:00 p.m. to CC:PA:LPD:PR (Notice 2011-56), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue NW., Washington, D.C. 20224.

Notice 2011-56, 2011FED ¶46,403

Other References:

Code Sec. 1012

CCH Reference – 2011FED ¶29,335.9523

Code Sec. 6045

CCH Reference – 2011FED ¶35,930.27

Tax Research Consultant

CCH Reference – TRC FILEBUS: 9,256

CCH Reference –

TRC SALES: 6,068

AUTHOR

Wolters Kluwer Tax and Accounting

Wolters Kluwer Tax and Accounting is a leading provider of software solutions and local expertise that helps tax, accounting, and audit professionals research and navigate complex regulations, comply with legislation, manage their businesses and advise clients with speed, accuracy and efficiency. Wolters Kluwer Tax and Accounting is part of Wolters Kluwer N.V. (AEX: WKL), a global leader in information services and solutions for professionals in the health, tax and accounting, risk and compliance, finance and legal sectors. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with specialized technology and services. Wolters Kluwer reported 2016 annual revenues of €4.3 billion. The company, headquartered in Alphen aan den Rijn, the Netherlands, serves customers in over 180 countries, maintains operations in over 40 countries and employs 19,000 people worldwide. Wolters Kluwer shares are listed on Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices. Wolters Kluwer has a sponsored Level 1 American Depositary Receipt program. The ADRs are traded on the over-the-counter market in the U.S. (WTKWY).

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