Tiziana Life Sciences spun off Accustem Sciences as a stock dividend. The ex-dividend date was October 30, 2020 but the Accustem shares were not distributed to Tiziana shareholders until July 21, 2021. According to documents Tiziana filed with the SEC, this transaction is tax-free to UK shareholders. For these instructions, it is assumed the tax-free status is also true for US shareholders. Tiziana Life Sciences shareholders received 1 share of ACMSY for each share of TLSA owned.
This action is a simple spinoff transaction in the accounting software. It is structured to be a non-taxable event for Tiziana Life Sciences shareholders. The cost basis allocation information is calculated from the closing prices of ACMSY and TLSA on the day ACMSY shares were actually distributed.
The cost basis allocation is dependent on the prices used for both Tiziana Life Sciences and Accustem Sciences in the cost basis allocation 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.
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: http://www.iclub.com/support/kb/default.asp?page=normal_spinoff
Here is the information you need to complete the spinoff.
Save the transaction and the spinoff has been entered.
Note about ACMSY price availability
ACMSY trades on the Pink Sheets in the US. The myICLUB price database does not cover the Pink Sheets. The automatic price display on the main Accounting page on myICLUB will not be updated for ACMSY. Also, when entering valuations, ACMSY will be assigned a price of zero when its ticker symbol is not recognized by the price database. The price per share for ACMSY must be hand entered to get a correct price for the valuation. Many common share price web sites also do not cover the Pink Sheets. One that does is Yahoo Finance.