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Merger, Reverse Split and $ per share?

Questions about updating prices or transactions in Fund Manager

Postby heidiasst » Fri Jun 08, 2018 10:28 am

Hi Mark,

We received a reverse split of 1 share of CVIA for every 5 shares of FMSA we owned.
They are showing the cost basis of these new shares to be $24.05. They also paid $.73148 for every share of FMSA we owned. This is not due to any partial shares sold.

So, I have entered the reverse split, I renamed the stock in Investment Properties.

I am a bit at a loss as to how to enter the cash value we received and not sure what I should be doing with the cost basis? I am guessing that I leave my cost basis as it was in FM when we purchased the stock.

Thanks for your guidance!
Heidi
heidiasst
 
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Postby Mark » Sun Jun 10, 2018 3:14 pm

Hi Heidi,

The money received would be a distribution. You would have to research or contact your broker to find out what to do with the cost basis, but if this received money lowered your cost basis, you would record it as a "Return of Capital" distribution. A Return of Capital distribution lowers your tax cost basis. It may be necessary to record it as 2 separate distributions if the cost basis was not lowered by the full amount of the money received. Part of the money could be a Return of Capital, and part of it could be another type of distribution, like maybe just "Other".
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
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