Final RegulationsFinal RegulationsIssuer ObligationsCorporate Actionsp

Transfer StatementCBRS

STA Small Agents TrainingOctober 20, 2010

Final RegulationsFinal Regulations Transfer Statements Can Be Delayed Transfer Statements Can Be Delayed DRP 10% Rule Shareholder Transaction Confirm Shareholder Transaction Confirm S Corporations All TA’s Included and Must Adjust Basis All TAs Included and Must Adjust Basis Corporate Action Sequence # Eliminated FMV on Date of Death for Inheritances FMV on Date of Death for Inheritances Corrections: 3 Years After Issuing 1099B or

18 Months After Transfer18 Months After Transfer

Issuer ObligationsIssuer Obligations Corporate Action Tax TreatmentTreatment Corporate Action Tax TreatmentTreatment

File with IRS Furnish Statement to ShareholdersFurnish Statement to Shareholders Within 45 days Or Publish on Issuer Website (10 Years)Or Publish on Issuer Website (10 Years)

Cost Basis on Stock Issuances FMV for Gift Transfers When No Trading FMV for Gift Transfers When No Trading

(IRS Publication 561)

Corporate ActionsCorporate Actions Reorgs/Mergers

Issuer Provides Basis Stock Dividends

Create a New Lot; Basis = DividendCreate a New Lot; Basis Dividend Stock Splits

Revalue Existing Lots; Increase # of Shares and Inversely Reduce Price Per ShareInversely Reduce Price Per Share

Reverse Splits Revalue Existing Lots; Decrease # of Shares and

Inversely Increase Price per ShareInversely Increase Price per Share Return of Capital

Reduce the Basis of Each Lot by the Per Share AmountAmount

Transfer StatementTransfer Statement Must Be Sent/Received Within 15 Days Must Be Sent/Received Within 15 Days

of Transfer If Not Obligation to Request If Not, Obligation to Request Sample Statement Can Also Be Used

for Correction and for Requestfor Correction and for Request

Cost Basis Reporting Cost Basis Reporting Service Existing DTC System Used in Conjunction

with ACATSwith ACATS Unique ID A Vi D t T i i W bDi t Access Via Data Transmission or WebDirect 4 Record Types Non-DTC Eligible Issues WebDirect Training Will Be Available

To Become a CBRS User www.dtcc.com

To Become a CBRS User

Equities/Clearance/CBRS/Customer Resources

User Agreement CBRS User Questionnaire Formation Document W9 ePayment Form Service-Add Letter Access Coordinator Form (WebDirect)

CBRS FeesCBRS Fees Original Original

○ Receiver .09 Sender .01

Corrected Corrected ○ Receiver .09 Sender .01

Request Request○ Receiver .03 Sender .03

Reject Reject○ Receiver .05 Sender .00

Minimum $100 per month Minimum $100 per month

ResourcesResources Final Regulations Final Regulations STA Cost Basis Guidelines Broker Scenarios Broker Scenarios IRS Publication 526 Gifting IRS Publication 550 Sales (including

Wash Sales) IRS Publication 561 Fair Market Value