Kyndryl says one possible method is to divide the cost basis 4.18%/95.82%.
One possible approach is to utilize the New York Stock Exchange closing price on November 4, 2021 (the first trading day immediately after the Distribution), for IBM common stock ($120.85 per share) and for Kyndryl common stock ($26.38 per share) as the fair market value.
At a distribution rate of 1:5, the weighted value of the distribution would be $5.28 ($26.38 / 5) worth of Kyndryl stock for every share of IBM stock. Therefore, you would allocate 4.18% ($5.28 / ($120.85 + $5.28)) of your tax basis in your IBM shares immediately prior to the Distribution to the Kyndryl shares received in the distribution and allocate 95.82% ($120.85 / ($120.85 + $5.28)) of your tax basis to your IBM shares.
See Tax Basis FAQ
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