Updated October 19, 2026. Quick answer: Form 1099-CAP is the statement a corporation sends when you may have to recognize gain from stock exchanged in a change in control or a substantial change in capital structure. Boxes 1 to 4 show the date, the amount received, the shares and the stock classes. The instructions say to report any gain on Form 8949 and that you cannot claim a loss.
What Form 1099-CAP reports
The form is titled Changes in Corporate Control and Capital Structure. The shareholder instructions open with who sends it and when: “A corporation in which you own stock that has had a change in control or a substantial change in capital structure must send you this statement by January 31 of the year following the calendar year of the change.”
They also say why you got it: “You have received this statement because the corporation has reasonably determined that you may be required to recognize gain from the receipt of cash, stock, or other property that was exchanged for the corporation’s stock.” The wording is cautious, and it is worth reading closely. The form tells you that gain may be required to be recognized, and it leaves the figuring to you. The Copy B legend adds that “This is important tax information and is being furnished to the IRS.”
Boxes 1 to 5 at a glance
The table gives the shareholder instructions for each numbered box. Box 5 is included because it is printed on the form, but nothing is written beside it.
| Box | What the form says |
|---|---|
| Box 1 | “Shows the date the stock was exchanged for cash, stock, or other property.” |
| Box 2 | “Shows the aggregate amount of any cash and the fair market value of any stock or other property received by you in the exchange for the stock you held.” |
| Box 3 | “Shows the number of shares of the corporation’s stock that you held which were exchanged in the transaction.” |
| Box 4 | “Shows the class or classes of stock that were exchanged.” |
| Box 5 | The form prints the number 5 with no label next to it. |
Box 2 is the one most readers focus on, because it is the dollar amount. It combines cash with the fair market value of any stock or other property you received. The payer-side instructions agree: “Enter the aggregate amount of cash and the FMV of any stock and other property received in exchange for the number of shares exchanged in the reporting corporation.”
The box 2 footnote
Box 2 carries an asterisk on the form. The footnote on the shareholder copy reads: “You cannot claim a loss based on the amount in box 2.” The instructions say the same thing in the main text, in the form of a rule about Form 8949 that is covered next. Read the footnote and the rule together, because they point the same way.
Where it goes on the return
The shareholder instructions give two sentences: “Report any gain from the exchange on Form 8949.” “However, you cannot claim a (loss) on Form 8949 as a result of this exchange.” The pointer for more detail is “See chapter 4 of Pub. 550 for additional information.”
The mechanics of the form are in the Form 8949 checkbox guide, and the totals that come from it are on Schedule D lines 8b, 9 and 10 for long-term transactions and Schedule D lines 1b, 2 and 3 for short-term ones. For the rest of the return, see Form 1040 line 7 on capital gain or loss.
What the corporation was told to enter
Reading the payer’s instructions shows how the numbers were produced, so you can compare them with your own records. Box 1: “Enter the trade date of the sale or exchange, actually or constructively received.” Box 3: “Enter the number of shares the shareholder exchanged in the reporting corporation for cash or other property received.” Box 4: “Enter the class or classes of stock (for example, preferred, common, etc.) exchanged in the reporting corporation for cash or other property received.”
The same instructions let the corporation shorten the class: “Abbreviate the class to fit the entry.” So box 4 may show a single letter. If you hold more than one class of stock in the same corporation, the box tells you which class the exchange involved. The Form 1099-B boxes that cover ordinary sales are on Form 1099-B boxes 1d and 1e and Form 1099-B box 2.
Brokers and Form 1099-B
The payer instructions also describe who files: “Any broker who holds shares on behalf of a customer in a corporation that the broker knows or has reason to know based on readily available information has engaged in a transaction of acquisition of control or substantial change in capital structure must file Form 1099-B unless the customer is an exempt recipient.” That is a statement about the broker’s obligation. For a plain walk through of that form and its cousins, see the 1099-DIV, 1099-INT and 1099-B boxes guide. On the sibling pages, Form 2439 boxes 1a to 1d and Form 2439 box 2 cover another kind of year-end notice about gain.
Your taxpayer identification number and account number
The shareholder instructions also explain two items on the face of the form. On the number: “For your protection, this form may show only the last four digits of your TIN”. They add “the issuer has reported your complete TIN to the IRS.” On the account number: “May show an account or other unique number the payer corporation assigned to distinguish your account.” Neither item changes the tax treatment. Both help you match the form to your own records.
Edition and box numbers
The edition used for this page is Form 1099-CAP (Rev. April 2025), with its instructions for the shareholder on Copy B. Check the year and edition printed on the form you received, because box numbers can change between editions.
Common mistakes
- Treating the exchange as a loss. The instructions say “you cannot claim a (loss) on Form 8949 as a result of this exchange”.
- Leaving the form off the return because box 2 is not labeled income. The instructions say “Report any gain from the exchange on Form 8949.”
- Waiting past the date on the instructions before asking about a missing form. The corporation “must send you this statement by January 31 of the year following the calendar year of the change”.
Related: the Form 8949 checkbox guide, Schedule D lines 8b, 9 and 10, Schedule D lines 1b, 2 and 3, Form 1099-B boxes 1d and 1e, and the 1099-DIV, 1099-INT and 1099-B boxes guide.
Sources
- Form 1099-CAP, Changes in Corporate Control and Capital Structure (Rev. April 2025), with Instructions for Shareholder: https://www.irs.gov/pub/irs-pdf/f1099cap.pdf
- Instructions for Form 1099-CAP: https://www.irs.gov/pub/irs-pdf/i1099cap.pdf
- IRS: About Form 1099-CAP: https://www.irs.gov/forms-pubs/about-form-1099-cap
Read from the IRS documents linked above on October 19, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.