A spin-off is a stock dividend issued in a new or different (child) company and not in the original (parent) company. As no money changes hands, the spin-off distribution is generally a non-taxable event.
Brokers vary widely as to how (and if) they report spin-offs on their statements. This makes it virtually impossible to automate the importing of these transactions in a software program, so manual adjustment is required by the user to account for the new stock.
If you have received new stock, you may need to manually enter a trade in your data file:
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From the Records menu, click Add Record to add a new trade record. See Adding or Inserting a Record. TradeLog will automatically assign a new trade number to this trade record.
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In the Date column, enter the purchase date of the parent company shares (do not use the date the shares were spun off).
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In the O/C column, enter "O" for a new opening transaction.
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In the L/S column, enter "L" for a new long position.
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In the Ticker column, enter the ticker description exactly as shown on your trade history report. This will enable TradeLog to correctly match the appropriate closing transaction with this opening transaction.
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In the Sh/Cont column, enter the total number of shares you received from the spinoff.
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In the Price column, enter the cost basis for the new shares.
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Leave the Commission field blank.
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Hit the <Enter> key twice to save your new record.
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A Confirm popup window will appear, asking "Save your changes?" Click YES to save, NO to cancel.
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If you selected YES, TradeLog will re-sort and re-match your trades.
You then need to adjust the cost basis of your original shares of stock so that the total amount of the original shares purchased plus the total amount of the shares spun-off equal your original cost.
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