TP sold a stock position late in December 2008 and reported the long- term capital loss on 2008 Schedule D.
2009 1099-DIV shows an amount for the stock in Box 1a (non-qualified dividends) and another amount for the stock in Box 3 (non-dividend distributions, return of capital).
There was a dividend in 2009 from having owned the stock late in
2008.
The question is how to report the Box 3 amount.
Ordinarily, it would be subtracted from the basis, so the impact would happen when the position is sold. In this case, no position was owned any time after 2008.
Is this considered a ?Nondividend Distribution Exceeding Basis? (pub
550 page 25)?