2018 Notice to Vector Group Ltd. Stockholders
Vector Group Ltd. believes a significant portion of its 2018 cash distributions will be considered a nontaxable return of capital.
As a result, the Company anticipates issuing a “Corrected” Form 1099-DIV to each of its stockholders upon the final determination of its 2018 earnings and profits. The determination of the Company’s 2018 earnings and profits will occur when the Company files its income tax return with the Internal Revenue Service (“IRS”) on or about October 15, 2019.
Each stockholder will then receive a “Corrected” Form 1099-DIV reflecting the correct amounts in Box 1a, Box 1b and Box 3.
Distributions that are not taxable as dividend income must be applied to reduce the adjusted tax basis of the shares on which the distributions are paid. If the nontaxable distributions exceed the stockholder’s basis in the Vector Group stock, a capital gain will result.
Stockholders should secure their own tax advice regarding this notice and the status of cash distributions under applicable federal, state and local tax laws.