Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15.
Q: I've acquired AT&T stock through various employee plans since 1947. I do not know the date of the plan completion. Without the date it's impossible to arrive at a price per share. If I want to sell the AT&T stock, how can I arrive at a reasonable price? How would the IRS react if I took a price of about $45 a share? I feel this may be close, but I cannot prove it.
A: You should contact AT&T to determine what records the company maintains of your cost basis of stock acquired through its employee plans. There are a lot of factors that could affect your basis. Were the purchases made with pre-tax or after-tax DTC dollars? Did AT&T contribute any to the cost, and was it taxed to you at the time of the purchase? What is the impact on your AT&T shares of the "Baby Bell" spinoff of 1984, and what stock splits have occurred from 1947 to the present? If you cannot get the information from AT&T, I would suggest you accumulate all statements you have from the plan(s) and contact your stockbroker or obtain a history of the market value of AT&T stock, or research the market value at the public library. It may be necessary to work with a tax adviser to help you determine how the factors mentioned affect your basis. On the other hand, if you have only a few shares of stock, from a practical point of view, it may not be advisable to spend a large amount of time researching this situation.
* John P. Abosch, KAWG&F, PA
The above advice is for general purposes only and is not intended as legal, accounting or tax advice. Specific situations may vary.
To ask a tax question, call Sundial, The Sun's telephone information service, at (410) 783-1800. Call 268-7736 in Anne Arundel County, 836-5028 in Harford County, 848-0338 in Carroll County. Using a Touch-Tone phone, punch in the four-digit code 6225 after the greeting. You can also submit questions by e-mail through The Sun's Web site: www.sunspot.net/tax.
Selected questions will be answered in the Business section. No questions will be answered personally.
Pub Date: 3/06/98