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Strategies & Market Trends : Income Taxes and Record Keeping ( tax )

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To: Bayclipper who wrote (465)1/15/1998 10:38:00 PM
From: Colin Cody  Read Replies (2) of 5810
 
The taxpayer must ALLOCATE the initial cost among the components he received. It is no different if the warrants expired or not. Each component must be allocated a price. If you sold the common stock for instance, you'd need to know what was the proper allocation for its cost.
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Their is an IRS procedure for doing this, but I don't have it available to me here. You might approximate it by getting the Market Value of the tradeable portions and allocate the remainder to the non-trading portions.
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Colin
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