Replies to post #58060 on Hartcourt Companies (fka HRCT)

[Investorman]

Each non-taxable spinoff has a cost basis attached to it. When sold, taxes are only due on the capital gain made on the new stock (and its related value from your original purchase of HRCT stock), not on the value at the time of the spinoff. The FTL stock is different since HRCT has elected not to value the FTL stock at the time of the spinoff as a part of the intrinsic value of your HRCT stock making the value of your FTL stock at the time you receive the shares fully taxable in this tax year whether you sell it or not. It is treated as a dividend not a spinoff of part of the company thus making it unearned income not capital gains.