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Author: lorenzo2 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121219  
Subject: Re: Reporting Tax Free Exchange Date: 1/25/2002 10:48 PM
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Since no one else has answered, I'll have a go. This is largely guesswork, but it is fairly well-educated (and well-intentioned!) guesswork, since I've been thru a few of these spinoffs.

Actually, this wasn't directly a T spinoff - I am a long-time T shareholder, and I didn't play in either the tracking stock or Liberty Media. As I recall, Liberty Media came along with TCI in 1999, and was run as a tracking stock. T found it necessary to spin it off as a completely independent company a bit later, to satisfy FCC concerns about cable operations. Investors who owned the LM tracking stock (whether they came in with TCI or purchased the tracking stock separately) were issued shares in the new company, one for one. It's a straight exchange of shares, and there were no sales involved, hence no 1099. You probably will have received a piece of paper, with a bunch of legal mumbo-jumbo, something like:

"The undersigned, a shareowner owning Class A shares of blah blah blah, received a distribution of Liberty Media blah blah blah.

"The undersigned received _______ whole shares of Class A common stock of Liberty Media in the distribution."

"And furthermore, to wit, habeus corpus blah blah blah Section 355 ipso facto."

You just fill in the blank (saying you received 110 shares, or whatever) and sign at the bottom. Send in a copy with your tax return. I don't know what the IRS does with these dumb things - they probably just pitch them.

Anyway, the short answer is: send in the statement that says you received a distribution of shares. Nothing else to do until you sell this puppy, and then you get to try to figure out what your basis is.

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