On April 1, 2000, Edwards Lifesciences spun off from Baxter. At this
time, shareholders were given 1 Edwards share for every 5 shares of
Baxter stock. Below is some information to assist you in computing
the tax basis. However, since individual situations vary greatly
based on specific financial conditions, we recommend you contact
your accountant or tax professional for the latest reporting
guidelines appropriate to you.
Computation of Tax Basis
| heading |
Baxter (Regular Way) |
Edwards Lifesciences (When Issued) |
| March 31, 2000 closing price on the NYSE
|
$62.6875 |
$13.5625 |
| heading |
Mar. 31, 2000
Per Share
Market Value (1) |
Value Adjusted
Per Previous Share
of Baxter Common (2) |
Adjusted Values
as a Percent
of Total (3) |
Multiplier
to Determine New
Per Share Cost Basis (4) |
Baxter
Common Stock |
$62.6875 |
$59.9750 |
0.95673 |
0.95673 |
Edwards Lifesciences
Common Stock |
$13.5625 |
$2.7125 |
0.04327 |
0.21635 |
| TOTAL |
—
|
$62.6875 |
1.00000 |
— |
To calculate the cost basis of your Baxter stock
(BAX):
Multiply the original total cost of your Baxter stock by 0.95673 (or
95.673%). The result is the new cost basis of your Baxter stock. (To
calculate the cost basis per share, please see the ratios under
Multiplier to Determine New Per Share Cost Basis found in the table
above.)
To calculate the cost basis of your Edwards Lifesciences
stock (EW):
Multiply the original total cost of your Baxter stock by 0.04327 (or
4.327%). The result is the new cost basis of your Edwards
Lifesciences stock. (To calculate the cost basis per share, please
see the ratios under Multiplier to Determine New Per Share Cost
Basis found in the table above.)
(1) The closing market price for each stock on March 31. The closing
market price of Baxter common stock trading regular way. The closing
market price of Edwards common stock trading when issued.
(2) Since Edwards shares are being distributed on a 1-for-5 basis,
the per share market values must be adjusted by dividing by five (5)
and the Baxter shares must be adjusted to reflect the value without
the value of the Edwards shares.
(3) These fractions represent the $59.9750 value of one share of
Baxter common stock and the $2.7125 value of one-fifth (1/5) share
of Edwards common stock received for one (1) share of Baxter common
stock, in relation to the sum of such values, $62.6875.
(4) Multiplier applicable to the previous per share tax basis for
Baxter common stock to determine the new per share cost basis for
each (Baxter and Edwards) stock. This multiplier is determined by
multiplying the percentage in column 3 for Baxter by one (1) for one
full share of Baxter stock and the percentage in column 3 by five
(5) to determine a full share of Edwards common stock.
On May 27, 2010, Edwards issued a 100% stock dividend for purposes of
effecting a two-for-one split of its common stock. In a two-for-one
stock split, each shareholder receives one additional share of stock
for each share owned as of the date of record. As an example, if you
owned 100 shares of Edwards’ common stock prior to the date of
record, you would own a total of 200 shares after the split became
effective. At the same time, the stock price would be reduced by
half.
On November 19, 2015, Edwards announced a two-for-one stock split to
be issued as a 100% stock dividend. The record date was November 30,
2015. The distribution date was December 11, 2015. Edwards stock
began trading on the NYSE at the new split-adjusted price on
December 14, 2015.
On May 7, 2020, during the annual shareholder meeting, stockholders
approved the company's plan to execute a 3-for-1 stock split. The
split of the company's outstanding shares of common stock was
effected in the form of a stock dividend of two shares of common
stock to the holders of record of each share of Edwards' common
stock as of the close of business on May 18, 2020. The additional
shares were distributed on May 29, 2020. For additional information,
please visit Stock Split FAQs section of our website.
Additional shares received pursuant to the stock split are deemed for
U.S. tax purposes to have been acquired on the same date as the
original shares. Each shareholder’s aggregate tax basis in the
shares of common stock will not change as a result of the dividend.
Following the dividend, each shareholder’s tax basis will be divided
equally between the existing shares and the new shares distributed
in connection with the dividend. For more detailed information, we
recommend you consult your tax advisor.
To download the current IRS Form 8937: Report of Organizational
Actions Affecting Basis of Securities click here.