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Financial Planning / Tax Strategies
|Subject: Basis question||Date: 8/9/2012 2:38 PM|
|Author: fleg9bo||Number: 116518 of 121219|
I'm getting an early start on my 2012 taxes.
Way back in the heady days of 1998 I bought 200 shares of CBS.
In 2000, that turned into 217 shares of Viacom. There was no cash paid out at the time -- no cash-in-lieu, no partial dividends, no nothing. Just the 217 shares.
In 2006, Viacom split off new CBS shares , leaving me with 108 shares of CBS-B and 108 shares of Viacom. A few days later I got two cash-in-lieu payments, one for each of the new companies.
I sold both issues this year for a gain. I figure I'll split my original CBS cost based on the relative value of the two daughter companies. That is, if Viacom was worth $20 per share after the split and CBS was worth $10 per share after the split, I'll apportion 2/3 of the basis to Viacom and 1/3 of the basis to CBS. How I do it won't affect the bottom line, but I want to get it right on general principle.
Then there's the matter of the cash-in-lieu payments. Since I already paid taxes on that, I assume I can increase my basis in each stock by the amount of the cash-in-lieu.
Do I have that right?
--fleg, who is glad he's saved all his brokerage statements since he started investing
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