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"A DuPont shareholder who receives cash in lieu of a fractional share of DowDuPont common stock in the DuPont Merger should generally be treated as having received a fractional share of DowDuPont common stock in the DuPont Merger and then having sold such fractional share for cash. The taxable gain or loss that you recognize with respect to any cash you receive in lieu of fractional shares is equal to the difference between the amount of cash you receive and your tax basis (determined as described below) in such fractional shares of DowDuPont common stock.
Tax Basis. Your aggregate tax basis in the DowDuPont common stock received in the DuPont merger (including fractional shares of DowDuPont common stock settled in cash) should be the same as the aggregate tax basis of the DuPont common stock surrendered in exchange therefor and should be allocated pro rata across the shares of DowDuPont common stock received such that each share of DowDuPont common stock received should have an identical, averaged basis, under Section 358(a) of the Code and Treas. Reg. §1.358-2(b)(2).
DuPont shareholders who are treated as having received a fractional share of DowDuPont common stock in the DuPont Merger and then having sold such fractional share for cash should determine their tax basis in the fractional shares sold by allocating their aggregate tax basis in the DuPont common stock surrendered in exchange for the DowDuPont common stock between the whole shares and the fractional shares based on the relative fair market values.
As an example, assume a DuPont shareholder has an aggregate $100 basis in 50 shares of DuPont stock (i.e., $2 per share), and the fair market value of one share of DowDuPont stock is $66.65. Following the DuPont Merger, the DuPont shareholder should have an aggregate $100 basis in 64.1 shares of DowDuPont stock (i.e., 50 shares x 1.2820, or $1.56 per share), and should be treated as having sold 0.1 shares of DowDuPont stock with a tax basis of $0.156 (i.e., $1.56 x 0.1 shares) for $6.67 (i.e., $66.65 per share fair market value x 0.1 shares)."
http://s21.q4cdn.com/813101928/files/doc_downloads/DowDuPont_Merger/Letter-to-Shareholders-final-9-1..."A DuPont shareholder who receives cash in lieu of a fractional share of DowDuPont common stock in the DuPont Merger should generally be treated as having received a fractional share of DowDuPont common stock in the DuPont Merger and then having sold such fractional share for cash. The taxable gain or loss that you recognize with respect to any cash you receive in lieu of fractional shares is equal to the difference between the amount of cash you receive and your tax basis (determined as described below) in such fractional shares of DowDuPont common stock.
Tax Basis. Your aggregate tax basis in the DowDuPont common stock received in the DuPont merger (including fractional shares of DowDuPont common stock settled in cash) should be the same as the aggregate tax basis of the DuPont common stock surrendered in exchange therefor and should be allocated pro rata across the shares of DowDuPont common stock received such that each share of DowDuPont common stock received should have an identical, averaged basis, under Section 358(a) of the Code and Treas. Reg. §1.358-2(b)(2).
DuPont shareholders who are treated as having received a fractional share of DowDuPont common stock in the DuPont Merger and then having sold such fractional share for cash should determine their tax basis in the fractional shares sold by allocating their aggregate tax basis in the DuPont common stock surrendered in exchange for the DowDuPont common stock between the whole shares and the fractional shares based on the relative fair market values.
As an example, assume a DuPont shareholder has an aggregate $100 basis in 50 shares of DuPont stock (i.e., $2 per share), and the fair market value of one share of DowDuPont stock is $66.65. Following the DuPont Merger, the DuPont shareholder should have an aggregate $100 basis in 64.1 shares of DowDuPont stock (i.e., 50 shares x 1.2820, or $1.56 per share), and should be treated as having sold 0.1 shares of DowDuPont stock with a tax basis of $0.156 (i.e., $1.56 x 0.1 shares) for $6.67 (i.e., $66.65 per share fair market value x 0.1 shares)."
http://s21.q4cdn.com/813101928/files/doc_downloads/DowDuPont_Merger/Letter-to-Shareholders-final-9-1...Still have questions?
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