How to handle DowDuPont Spinoff
Sharesight makes it easy for investors to handle corporate actions (even complicated demergers) and track the capital gains tax implications. The benefit of using Sharesight to track the DowDupont (DWDP:NYSE), Dow (DOW:NYSE), and Corteva (CTVA:NYSE) spin-off also ensures that you maintain an accurate record of your portfolio performance.
Dow Spin-off 1 – Click on DowDupont, DWDP on the Portfolio Overview Page, to go to the Individual Holding Page.
2 – Click ‘Enter a new Trade or Adjustment’.
3 – On the pop-up window, select ‘Adjust Cost Base’ from the transaction type dropdown.
Based on the Letter to Shareholders, set the:
4 – ‘Date of trade’: 01 April 2019
5 – ‘Demerger calculator’: Set the ratio to 66.438 : 33.562
6 – ‘Cost Base Reduction’: Enter the amount given in the Demerger Calculator.
Example If DWDP cost base as of the Record date is $33,905, Cost Base reduction is $11,379.20 ($33,905 x 33.562%).
Take note of the Cost Base Reduction amount
7 – Comment: DowDupont and Dow spin-off. The Record Date is on 01 April 2019.
8 – ‘Choose a file’: to help keep your records in order, you can attach the DowDupont Dow Stock Distribution letter.
9 – Click ‘Save this trade’.
Add DOW:NYSE 10 – Click ‘Add or Import Holdings’.
11 – Search for Dow Inc or DOW to locate the holding.
12 – Select ‘Opening Balance’.
13 – Select ‘Opening Balance Date’ as 01 April 2019.
14 – Input ‘Quantity’ as 3 DowDupont share to every 1 Dow share.
Example Own 500 DWDP as of the Record date - received 166 DOW Shares from the spin-off.
If there are fractional shares, take note of the cash payment received. It will be used to reduce DOW’s cost base.
15 – Input ‘Cost base US$’: Use the Cost Base Reduction amount from DowDupont minus any cash payment from fractional shares.
Example If DWDP cost base as of the Record date is $33,905, Cost Base reduction is $11,379.20 ($33,905 x 33.562%).
Cash payment for fractional shares (0.66) is $45.06. Therefore, DOW Cost Base is $11,334.14 ($11,379.20 - $45.06)
16 – Click ‘Save this holding’.
Corteva Spin-off 17 – Click on DowDupont, DWDP on the Portfolio Overview Page, to go to the individual holding page.
18 – Click ‘Enter a new Trade or Adjustment’.
19 – On the pop-up window, select ‘Adjust Cost Base’ from the transaction type dropdown.
Based on the information of distribution, set the:
20 – ‘Date of trade’: 01 June 2019
21 – ‘Demerger calculator’: Set the ratio to 74.13195 : 25.86805
22 – ‘Cost Base Reduction’: Enter the amount given in the Demerger Calculator.
Example If DWDP cost base as of the Record date is $22,525.8, Cost Base reduction is $5,826.99 ($22,525.8 x 25.86805%).
Take note of the Cost Base Reduction amount
23 – Comment: DowDupont and Corteva spin-off. The Record Date is on 01 June 2019.
24 – ‘Choose a file’: to help keep your records in order, you can attach the DowDupont Corteva Distribution Approval letter.
25 – Click ‘Save this trade’.
Add Corteva 26 – Click ‘Add or Import Holdings’.
27 – On the left hand side of the page, search for Corteva Inc or CTVA to locate the holding.
28 – Select ‘Opening Balance’.
29 – Select ‘Opening Balance Date’ as 01 June 2019.
30 – Input ‘Quantity’ as 3 DowDupont share to every 1 Corteva share.
Example Own 500 DWDP as of the Record date - received 166 CTVA Shares from the spin-off.
If there are fractional shares, take note of the cash payment received. It will be used to reduce CTVA’s cost base.
31 – Input ‘Cost base’: Use the Cost Base Reduction amount from DowDupont.
Example If DWDP cost base as of the Record date is $22,525.8, Cost Base reduction is $5,826.99 ($22,525.8 x 25.86805%).
Cash payment for fractional shares (0.66) is $23.08 Therefore, CTVA Cost Base is $5,803.91 ($5,826.99 - $23.08)
32 – Click ‘Save this holding’.
DowDuPont renamed DuPont de Nemours & reverse split
33 – Click on DowDupont, DWDP on the Portfolio Overview Page, to go to the individual holding page.
34 – On the DowDuPont Individual Holding Page, click on ‘Holding Settings’ tab.
35 – Click on ‘Merge this holding’ button.
36 – On the Merge Holding pop-up window, set the ‘Date of Merge’ as 01 June 2019.
37 – Type DuPont de Nemours or DD in the search field and select NYSE:DD DuPont de Nemours Inc from the dropdown list.
38 – Type in the ‘Quantity’ field: DWDP shares held on the Record Date.
Example If you owned 500 DWDP as of the record date, the quantity is 500.
39 - Click ‘Save this trade’.
The DuPont de Nemours Inc Individual Holding Page will load with the merged shares added.
Sharesight automatically create a 3:1 Consolidation trade for the reverse split.
The guide above is a suggestion on how to handle the corporate action in Sharesight and is not finance or tax advice. We advise you to consult your financial advisor or accountant. We also encourage you to review the official Documents for full details.
Last modified on August 19, 2021 UTC