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This Ruling has been obsoleted by AN 94(2)

Ruling 89-33

Capital Gains, Dividends and Interest Tax

You have questioned whether the forced sale of stock held by employees in corporations involved in corporate takeovers is subject to the Dividends, Interest Income and Capital Gains Tax.

The Connecticut Dividends, Interest Income and Capital Gains Tax is imposed on those gains realized for Federal income tax purposes. Since the gains in the forced sale of stock are taxed for Federal tax purposes, they are also taxed as Connecticut capital gains.

While I am sympathetic to the position that employees find themselves in, this Department is bound by statute to include these gains in the taxation of capital gains.


August 1, 1989