bill63

Fording Tax Avoidance Deal: Lots of Unanswered Questions

If you look at the bottom of page 102 in the pamphlet Fording sent share holders concerning the sale under U.S. Federal Tax Consequences it states "any such gain or loss generally should be capital gain or loss, which would be long term...Prefential tax rates apply...

On Nov 10 04:37 PM mdimillo wrote:

> If you read the full disclosure on the transaction for FDG, you would
> have noticed the unique aspect of the deal. It was considered as
> an asset purchase for tax purposes, which is treated the same as
> a dividend in terms of withholding. They even highlighted that US
> holders should consult their tax professionals for advice. Once I
> did this and discovered what would happen, I sold ahead of the closing.
> In a way you were lucky because the gain was in your Roth IRA. I
> had it my regular account and would have lost the long term capital
> gain rate on the sale and would have had to pay as if it were regular
> income. I gave up the last $3 cash payment to avoid paying regular
> taxes on a 300+% gain. In the future, I would suggest consulting
> a tax guy or doing more homework when the deal is this complicated.