A company that I own stock in, Cooper Industries, is considering a reorganization that will make shareholders responsible for capital gains tax for the increase in value of the stock when the reorganization takes place over their basis. Fortunately this reorganization has been put on hold for the time being and I hope it permanently rejected. I am a long time holder of the stock and so the gains I will be responsible for will be long term gains. My question is: If I sell the stock this year, to pay for the taxes, after the reorganization takes place and I sell at a price above the reorganization price, will the gain I realize on this be long term or short term. As I understand it, when and if the reorganization takes place, my basis for Cooper will be increased from whatever it was in the 1970's when I inherited the stock to whatever it is worth now. Will my holding period be shortened long term [from in excess of 20 years] to short term?Thanks, prime13
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