Cost Basis Update for S and C Corporations

Cost Basis FAQs for S and C Corporations.

The Emergency Economic Stabilization Act of 2008 amended the Internal Revenue Code (IRS) requiring brokers, including mutual fund companies, to report the sale of securities on covered securities.  The Act includes a provision that requires brokers and mutual funds to report sales of covered mutual fund shares that S Corporations acquire beginning on or after January 1, 2012. The IRS will require the reporting of gross proceeds from the sale of covered mutual fund shares, including the adjusted cost basis on gross proceeds, on Form 1099-B.

Currently, all corporations are exempt from cost basis tax reporting requirements.  Beginning with shares purchased on or after January 1, 2012, and subsequently redeemed, OppenheimerFunds will be required to report cost basis for S Corporations.  If you are an S Corporation and do not have a Taxpayer Identification Number (TIN) on file for your Oppenheimer fund account(s), your applicable transactions will be subject to 28% backup withholding.

C Corporations will continue to be exempt from reporting requirements. However, we will code all corporations as S Corporations in our systems unless informed otherwise.  If you are a C Corporation, it is imperative we receive certification of your federal tax classification as a C Corporation as soon as possible.  This recertification is required even if you have previously certified your status.  To certify your status as a C Corporation, please complete, sign, and return Form W-9 to us, or we will default your firm as an S Corporation.  Completed forms may be returned by mail or faxed to us at 303-768-1500.

We also would like to inform you that OppenheimerFunds has selected Average Cost as its default cost basis tax reporting method.  You may change your cost basis tax reporting method depending on your specific tax requirements.  Please note that money market mutual funds are not affected by the new regulations, but an exchange into any fund covered by the regulation (such as a stock or bond fund) will require a recertification as an S or C Corporation. 


Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested.

Before investing in any of the Oppenheimer funds, investors should carefully consider a fund's investment objectives, risks, charges and expenses. Fund prospectuses and summary prospectuses contain this and other information about the funds, and may be obtained by asking your financial advisor, visiting, or calling 1.800.CALL OPP (225.5677). Read prospectuses and summary prospectuses carefully before investing.

Oppenheimer funds are distributed by OppenheimerFunds Distributor, Inc.
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