The recipient of a nontaxable stock distribution will have a zero tax basis in the stock received in the distribution.

Name: The recipient of a nontaxable stock distribution will have a zero tax basis in the stock received in the distribution.
Brand: Quizplus
Rating: 4.9 (33 reviews)

Question

Quizplus · Accepted Answer

The recipient's tax basis in the stock received will be the same as the tax basis of the original stock they owned before the distribution. The distribution itself may be nontaxable, but it does not reset the tax basis of the stock.

The Recipient of a Nontaxable Stock Distribution Will Have a Zero