The Motley Fool Discussion Boards

Previous Page  
Financial Planning / Tax Strategies 

URL:
http://boards.fool.com/ififollowyouonyourexplanationofsplit10533406.aspx


Subject: Re: Stock split  Date: 1/19/1999 8:06 PM  
Author: TMFTaxes  Number: 8599 of 127825  
[[If I follow you on your explanation of split shares....correct me if i am wrong....If i started out with say 30 shares @ $50. and now i have 120 after two splits,,and then i sold 30 shares, the cost basis of those would be $50 , the next sale might be @ $25 and so on?????]] Nope...you are confusing yourself. I'll try again. In your example, your original basis was 30 shares at $50/share...for a total cost of $1,500. You now have 120 shares. So in order to compute your basis in all of these shares, you would divide $1,500 by 120 shares. This would give you a basis for EACH and EVERY share of $12.50 each. So if you sold 30 shares, your total cost basis for those 30 shares would be $375.00 (30 shares X $12.50/share). And this $12.50 basis is on EACH AND EVERY share that you own. Hope this clears it up... TMF Taxes Roy 

Copyright 19962018 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us 