Form 1099-CAP: Changes in Corporate Control and Capital Structure
Report changes in corporate control or capital structure that affect the basis of securities.
Filing Deadline
January 31 (to shareholders) / February 28 (paper) or March 31 (e-file) to IRS
Who Receives
Shareholders affected by acquisition or substantial capital structure change
Purpose
Reports basis information for securities involved in corporate transactions
Overview
Form 1099-CAP is used by corporations to report changes in control or capital structure that affect shareholders' basis in their stock or securities. This typically occurs during acquisitions, mergers, or significant restructurings.
The acquiring corporation must file this form when it acquires control or substantially all assets of another corporation in exchange for stock, and cash or other property is paid to shareholders.
Who Must File
Required Filers
- •Acquiring corporations that obtain control of another corporation in exchange for stock
- •Corporations that acquire substantially all assets of another corporation
- •Required when cash or other property (boot) is paid to target shareholders
- •Must file for each shareholder of record who receives cash or property
Exceptions & Notes
- ✕Not required if no cash or property is exchanged (stock-for-stock only)
- ✕Certain reorganizations under IRC section 368 may have modified requirements
Form Structure & Instructions
Here's what information is required in each section:
Corporate Action Information
Details about the acquisition or restructuring
Tax Information
Tax-related details of the transaction
Important Filing Notes
Acquisition of Control
Control generally means ownership of at least 80% of voting power and 80% of each class of nonvoting stock. Report when this threshold is met.
Substantially All Assets
The acquisition of substantially all assets typically means at least 70% of gross assets and 90% of net assets, though specific facts matter.
Shareholder Basis
This form helps shareholders calculate their basis in new securities received and determine gain or loss on any boot (cash/property) received.
Statement Requirement
Must also provide shareholders with a detailed written statement explaining the tax treatment of the transaction within 45 days.
Expert Corporate Transaction Reporting
Ensure accurate Form 1099-CAP filing for mergers, acquisitions, and restructurings. We handle the complexity so you can focus on your business combination.
Get Started Today