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Author: donrncsu Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121252  
Subject: how to handle a distribution via additional stoc Date: 1/12/2000 10:48 AM
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I am not sure how to handle the basis calculation on a recent distribution from a stock that I have held for several years. The company issued tax free new shares to current shareholders(an additional 5% for shares currently held). Is this just another version of a stock split? Would I handle the basis calculation the same way?
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Author: pmarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24897 of 121252
Subject: Re: how to handle a distribution via additional Date: 1/12/2000 12:26 PM
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<< I am not sure how to handle the basis calculation on a recent distribution from a stock that I have held for several years. The company issued tax free new shares to current shareholders(an additional 5% for shares currently held). Is this just another version of a stock split? Would I handle the basis calculation the same way? >>

It's a stock dividend. You handle the basis calculation the same way as you would for a split.

Phil Marti
Tax Preparer

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Author: mattpam Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24901 of 121252
Subject: Re: how to handle a distribution via additional Date: 1/12/2000 12:36 PM
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The basis remains the same if you sell all of them, the capital gain will be selling price minus original cost. However, the adjusted cost per share is now 100 divided
by 105, times the original cost per share. So if you
sell part of your holding, you would multiply this
adjusted basis per share by the number of shares sold to get the cost for tax purposes. Be sure to keep a note of the adjusted basis per share in your records as
you will need it every you sell, until all of the stock is sold. Have a great 2000 - - Matthew


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Author: stork1344 Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 24918 of 121252
Subject: Re: how to handle a distribution via additional Date: 1/12/2000 6:28 PM
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Yes, it's like a stock split, handled in the same way.

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