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HP Inc. Message Board

youreallyarestupid_duh 1 post  |  Last Activity: Oct 14, 2015 10:35 PM Member since: Nov 9, 2005
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    New Cost Basis of HP Shares

    by betingman Oct 14, 2015 11:55 AM
    youreallyarestupid_duh youreallyarestupid_duh Oct 14, 2015 10:35 PM Flag

    I am not an accountant, but the new HPE stock you receive is being paid as a stock dividend. If a stock dividend is paid in the same stock then it is treated as your total cost basis amount is the same divided by the new number of shares. If you had 100 shares of XYZ at a cost basis of $10 per share (eg. $1000 cost basis), then if the company paid a 10% stock dividend, your cost basis is still $1000 but divided by 110 shares (eg. $9.09 per share). However, this is being paid as a total new company, but my assumption would be that if you paid $20 per share for 1000 shares that now you would have 1000 shares of HPQ with $10 per share cost basis and 1000 shares of HPE at a $10 per share cost basis. When sold, the HPE shares are treated for capital gains / loss purposes as the amount of time you held the original 1000 shares.

    I suggest you talk to a tax accountant. :-)

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