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Technology Stocks : Nortel Networks (NT) -- Ignore unavailable to you. Want to Upgrade?

To: llwk7051@aol.com who wrote (3145)	8/2/1999 1:00:00 PM
From: Foo Bar	Read Replies (4) \| Respond to of 14638

the stock dividend has no U.S. tax effect I am no tax expert, but I am not sure if the above statement is true. When 1 for 1 stock dividend happens, the stock holder is given 1 share for every share he owns. That means that the cost of the original share you purchased does not change except the value of the stock went down half. The new share you have just received has 0 cost. So the effects include the following: 1) holding time difference (the original share may qualify for lower tax rate) 2) Cost base difference. You may be able to claim loss if the after-split price is lower than your original cost for the original shares 3) keep the dividend shares for another 18 months for lower tax rate as you have 0 cost base