Historical Quote

[Corduroy Frog]

This one is really tough, and I appreciate any help.

A client sold inherited stock in 2024.  The stock is "WESTROCK CO" The stock symbol is truncated by Schwab, so we can't tell the symbol.  The selling price was $51 per share in 2024.
We need the historical price as of April 23, 2001, when the mother died.

We do know at the time in 2001, there was a predecessor company in Chattanooga, TN.

Hint:  We have already consulted with Stock websites such as "Investor.com" and "Bigcharts.Marketwatch.com" and they are no help at all.  Tjhe brokerage firm, Schwab" can't help either and listed $5.25 as the "basis" but could not confirm it.  Actually we do know that prior to 2011, brokerage firms were not required to track basis.

Preparers like myself are not going to be able to help.  If any of you are savvy in investment data, please look into this and I will appreciate it.

 

[jklcpa]

Looks like it was under another name and became Westrock through a merger. You may have to work backwards from the # of shares now to what was originally held before looking up the historical prices.

Found this on Wikipedia that may help, if this is the company you need data for:

https://en.wikipedia.org/wiki/WestRock

[Slippery Pencil]

Westrock was WRK on the nyse.  Though that isn't really helpful since you need to know the predecessor's info.

The client has a trade confirmation from Schwab that has more info than the 1099. 

You can google the cusip # if you need more info such as a symbol or co. name.  Though at this point you won't find anything w/ the symbol on bigcharts, etc because the company merged and the symbol no longer exists.

Unfortunately for the client, if they don't have basis info, the irs says the basis is zero.  That wouldn't stop me from using a reasonable estimate from the client, but they need to know it will be reduced to zero if the irs questions it.

[Corduroy Frog]

Thanks jkl and PencilGuy.  I will use the information you have provided to research.

[Patti in Upstate NY]

I had someone last week with this.  His father worked at a paper mill named Westvaco and received stock through employment.  Father died, stock went to Mom and at some point, it became Westrock.  My client inherited when his mother died six years ago.  I looked up the closing price on DOD and used that as basis.  Right or wrong, that was how I handled it.  He still showed a significant gain and owed around $10K if I recall.  

[BrewOne]

you do the best you can.  document your work and show that it's a reasonable number.  Back in the olden days (when IRS might look at a return), the IRS would accept it.

I went through Tax-Aide training this year just so i could be comfortable sending my easy clients to them.  I was not happy when, during the Capital Gains section, they said if the client can't supply cost basis to put in zero.  That's terrible.

[Catherine]

If you know a good broker (as opposed to the customer service "broker equivalents" who answer phones at big houses, they can dredge up old merger & acquisition historical data from tools they have but we don't. I have a broker I've worked with for years and years who has helped me in just that way several times. 

The good ones see it as a treasure hunt (and maybe a way to show off, a little bit), and probably enjoy doing something more challenging than selling the latest big thing their house is pushing brokers to sell. 

Look for a small local or boutique firm as that's where you are more likely to find someone with the tools.

[jklcpa]

10 hours ago, Corduroy Frog said:

We do know at the time in 2001, there was a predecessor company in Chattanooga, TN.

The Wikipedia link from my first post has links and references to the 2 immediate predecessors, one of which was RockTenn.

RockTenn's wiki page has the company's history of a merger in 1973, so that is probably what your client's mother owned when she passed in 2001.  RockTenn came from a merger of 2 other TN companies, one with history going back 125+ years in Nashville. Maybe some of the history on that page will help you figure out which company your client had to start with.

Does the client's county register of wills have archives of estate filings that could be retrieved? IF the gain is substantial, it may be the most expedient method to get that information for a small fee rather than trying to recreate something you are unsure of or can't truly document.

[TexTaxToo]

2 hours ago, BrewOne said:

I went through Tax-Aide training this year just so i could be comfortable sending my easy clients to them.  I was not happy when, during the Capital Gains section, they said if the client can't supply cost basis to put in zero.  That's terrible.

Hmm.  Pub 4012 is the guide for VITA/TCE.  It says:

Quote

Inherited securities are only in scope when the taxpayer provides the basis. Gifted securities are only in scope when the taxpayer provides the basis and the holding period.

...

If the statement or taxpayer does not provide cost basis, historical data can be used. See Publication 551, Basis of Assets, for details. If basis can’t be determined, use zero.

 

[Catherine]

Well, then it's reasonably clear that VITA/TCE is assuming the historical data cannot be accessed in a reasonable manner in a reasonable time, therefore the only option is zero.

[Lion EA]

Is Westrock the current/successor company? Their investor relations department might have historical data, including a program or spreadsheet that works back through mergers/acquisitions/splits/etc.

Remember all the Baby Bells before covered trades?! They had (have?) an online app that let you start from when you sold taking you back to the date you said you bought/inherited and took you through the mergers and splits. You could also start from when you bought/inherited, so it took you through from that direction. I had to use that a few times with clients.

[BrewOne]

in response to Tex,

then that must have been the local instructor's "interpretation" of basis rules for the program.  I would be okay if they just said this is "out of scope"--instead of plugging in zero, they would be a lot better off with a paid preparer.

[Max W]

Westrock was created in 2015 by the merger of MeadWestvaco and RockTenn.  To compound the problem, MeadWestvaco was the result of a merger between Mead and Westvaco in 2002.   So, unless one knows which of the three stocks was inherited, you are shooting in the dark.   Having said that, I think the RockTenn would be the most likely one as it operated in TN going back to 1973.

The above info was gathered from perplexity.ai

[Max W]

From SEC archives -  One of these contacts might help

RockTenn Contacts:MWV Contacts:

Investor Contact:Investor Contact:

John StakelJason Thompson

Senior Vice President, TreasurerDirector, Investor Relations

678-291-7901804-444-2556 

[email protected] 

  

Media Contact:Media Contact:

Robin KeeganTucker McNeil

Director, Corporate CommunicationsDirector, Corporate Communications

770-326-8245804-444-6397

[email protected]@mwv.com

  

Sard Verbinnen & CoJoele Frank, Wilkinson Brimmer Katcher

Bryan Locke/Carissa Felger/Elizabeth SmithSteve Frankel/Joseph Snodgrass

312-895-4700212-355-4449

[Corduroy Frog]

Thanks to all - the help is coming in faster than I can research.

By the way, there is absolutely NO WAY I'm going to report zero as basis.

[Sara EA]

6 hours ago, Lion EA said:

Remember all the Baby Bells before covered trades?

I tell clients who owned original AT&T stock and now own 28 companies that themselves have had mergers and splits to never sell.  Just let their kids inherit the stock to save us all a lot of trouble!

[Corduroy Frog]

Done all the research I'm going to - it was a Magic Carpet ride.

Several companies have been involved since 2001:

1. Westrock
2. RockTenn
3. Mead/Westvaco
4. Mead Corporate
5. Westvaco
6. Smurfit/Westrock

Sold for $51/share, and Schwab reported basis of $5.17.  I began my research because I thought Schwab's basis was ridiculously low.

However, reading about these old companies in Wikipedia, some sales statistics were discussed, and most of the predecessor companies had sales which increased exponentially, so the Schwab basis of $5.17 doesn't seem so low anymore.

The 2024 sale to Smurfit was a 1:1 stock exchange with some $6,200 in cash.  I believe I can report LTCG income as $6,200 and add it to the new Smurfit basis which is still ridiculously low.

Taxpayer and spouse is 79 years old, and if left to their son, the historical mess will disappear.

Thanks to all for comments and assistance.

[TexTaxToo]

Have you reviewed the Proxy statement regarding tax matters for the merger:

https://www.sec.gov/Archives/edgar/data/1732845/000110465924053001/tm243828-20_defm14a.htm#tMUFI

Quote

The receipt of Smurfit WestRock Shares and cash in exchange for WestRock Stock pursuant to the Merger will be a taxable transaction for U.S. federal income tax purposes. A U.S. Holder of WestRock Stock that receives Smurfit WestRock Shares and cash pursuant to the Merger will generally recognize taxable gain or loss equal to the difference between (1) the sum of the fair market value of the Smurfit WestRock Shares and any cash received as consideration in the Merger and (2) its adjusted tax basis in the WestRock Stock surrendered in the exchange.