The spinoff is a taxable dividend. As a result, there is no effect on your tax basis for your AHT shares. Your basis in the AHP shares is equal to the amount of taxable income you must report as a result of the dividend. This is limited to the amount of accumulated Earnings and Profits (E&P) that AHT had at the time of the distribution. E&P is a tax term that essentially means retained earnings calculated on an income tax basis. It should be no where near the reported share value of $21.50, but we won't know how much it is until we get our 1099s in January.