Spinoff of Bioverativ (BIVV) from Biogen (BIIB)

Biogen spun off Bioverativ effective February 1, 2017 in a transaction meant to be tax-free to its shareholders. Bioverativ began normal trading on the NYSE Thursday, February 2, 2017.

The remaining basis percentage information listed below was calculated according to IRS regulation. The equation for that calculation is: (value of parent post spinoff)/ (total value of parent and daughter post spinoff). There was no appreciable difference between the value calculated when using opening, closing or the average of opening and closing prices for BIIB and BIVV.  When these instructions were written neither BIIB nor BIVV had posted IRS form 8937 with cost basis calculation examples.


This action is a simple spinoff transaction in the accounting software.  The information below is based on IRS cost basis allocation regulations.


The Spinoff Entry

Go to Transactions > Spinoff  or Accounting > Securities > Record spinoff of securities depending on the version of the software being used. If you are unfamiliar with spinoff transactions you can get help at this URL: https://www.iclub.com/support/kb/default.asp?page=normal_spinoff

Here is the information you need to complete the spinoff.


Date: 2/1/2017

Select Parent Security (or Parent Company) : Biogen (BIIB)

Remaining Basis Percentage: 92.17

Cash received:  See your broker statement for cash-in-lieu received

Spinoff  Security (or Symbol of New Company) : Bioverativ  (BIVV)

 Shares received : 0.5 x (# of BIIB  shares owned)   (Remember to include fractional shares.)

For example, if you owned 100 BIIB shares, you should receive 0.5 x 100 = 50  BIVV shares.

Price Per Share : 44.79  (Opening  price on 2/2/2017)  

Save the transaction and the spinoff has been entered.



The cost basis allocation is dependent on the prices used for both Biogen and Bioverativ in the cost basis calculations. In our experience brokers tend to use the prices found in the guidance companies post on their websites including IRS form 8937. If your broker does not use that guidance, the cost basis of the companies involved as recorded in your accounting records and in your broker’s records will not match. This is not cause for concern. This is just due to the inexact nature of the tax code in this regard. Partnership tax returns have specific areas to reconcile these usually small differences. ICLUBcentral tax printer software automatically fills in these adjustments in the normal operation of the software using the data imported from your accounting records and that you enter from your 1099.