tag:infinitekind.tenderapp.com,2009-01-14:/discussions/investments/6187-return-of-capital-specifically-a-spin-offInfinite Kind: Discussion 2021-12-18T17:00:18Ztag:infinitekind.tenderapp.com,2009-01-14:Comment/493942092021-09-18T16:51:40Z2021-09-18T16:51:40ZReturn of Capital (specifically a spin-off)<div><p>I think I have a workable work-around for the lack of Return of Capital for a spin-off type transaction that does not generate a capital gains and keeps the history intact.</p>
<p>This works when the cost basis is averaged (not for lot based).</p>
<p>On the date of the spin-off, create a sell tx for the original company, make the shares sold = 0 and add a FEE (I created a category for this 'spin-off' for the tx equal to the amount of the return of capital. This reduces the cost basis of the original stock without affecting history or creating a capital gains.</p>
<p>For the new spin-off company, create a buyXrf tx and buy the correct number of shares and transfer the full amount of the FEE above. This creates the new stock with the correct valuation and cost basis.</p></div>Bob B