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March 15, 2023
Question

On 1099B Form, is "Return of capital for fractional shares or cash in lieu" the same as "a Short Sale"?

  • March 15, 2023
  • 1 reply
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Looking specifically at the question on 1099B, "How did you receive this investment?" Return of capital is not listed but short sale is.

1 reply

March 15, 2023

No, cash in lieu is not the same as a short sale.  Cash in lieu typically is payment for fractional shares after a merger/acquisition. Rather than issue you a fractional share, they give you cash.  You are being asked how you acquired that shares that were liquidated in the transaction.  More than likely you purchased them, but you could have inherited them, or had them gifted to you.  If you have engaged in a short sale, you would know about it.  

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