Altaba, formerly Yahoo, is undergoing a liquidation and will cease to exist as a company sometime in 2020. During its dissolution process it will be selling assets and disbursing proceeds to AABA shareholders. The first distribution was payable September 23, 2019 in the amount of $51.60 per share in cash.
According to the proxy statement from AABA sent to shareholders to approve the dissolution, the distributions will be non-taxable returns of capital. These will decrease the cost basis in the AABA shares. Any cash received in excess of the cost basis in the AABA shares will be either long-term or short-term capital gain.
Altaba (AABA) will likely make multiple payouts before fully closing. Assuming that happens, use the basic information below, and simply change the date and amount used in the transaction as needed.
The Return of Capital Entry
Go to Transactions > Dividend or Distribution or Accounting > Securities > Cash Distribution depending on the version of the software being used. Here is the information you need to complete the dividend entry.
Amount: [51.60 x (# of AABA shares owned)
For example, if you owned 100 shares of AABA your amount would be 51.60 x100 = 5160.
Check your broker statement also.
Ex Dividend date: Does not apply for a Return of capital.
Type : Return of capital.
Select Security: Altaba (AABA)
Save the transaction and the Return of capital has been entered.
NOTE: If your cost basis is less than the return of capital amount, the program will convert the excess into a capital gain. Depending on the holding periods of your tax lots, this may be long-term, short-term or a combination of the two.