@bennythetaxman69 No, that's just not correct. Tax free spin offs happen all the time where you end up with the same number of shares in the parent company and some other amount of shares in the new "child" company. Tax rules require that you ALLOCATE your original basis in the parent between the parent and the new child based on the relative FMV of your holdings immediately after the spin off. This allocation would also go to any fractional shares received, but immediately sold via the "cash in lieu". The holding period in the new stock is the same as the holding period of the old stock.
