Received a class-action settlement cheque? Here’s everything you need to know about the tax consequences
If you held shares in Penn West Petroleum Ltd., which changed its name to Obsidian Energy Ltd. in mid-2017, from March 2011 through July 2014, you may have just received a cheque from the settlement of a class-action lawsuit brought against the company in 2014.
The plaintiffs in the class action alleged Penn West’s historical financial statements were not prepared in accordance with Generally Accepted Accounting Principles and/or International Financial Reporting Standards.
But you may be wondering: how are these payments taxed?