Tyco cash settlement

Nov 30, 2007 2 Replies

As a result of a class action suit, people who bought/sold shares of Tyco between December 13, 1999 through and including June 7, 2002 may be eligible for a cash settlement payment. See

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What are the tax consequences if I, age 66 and retired, receive a cash payment because of Tyco transactions within a traditional IRA? Would the settlement be treated as an IRA withdrawal? Could/should the settlement amount be placed into the IRA?



What are the tax consequences if I receive a payment because of transactions in a regular (i.e. non IRA, non tax deferred) account?



I am wondering whether filing a claim will be more trouble than it is worth.



Tom



The claim form should be in the name of the IRA, so the check will also be in that name.

The IRA custodian should be told to deposit that check to the IRA and code the deposit as a dividend or other earnings, and not as a contribution.

Arthur,

Thanks so much. I'll check with the company where I have the IRA.

Tom

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