Lithium Americas Corp spun off Lithium Americas Argentina effective September 30, 2023 in a transaction meant to be tax-free to LAC shareholders. Lithium Americas Argentina began normal trading on October 4, 2023. LAC shareholders received 1 share of LAAC for each 1 shares of LAC owned.

Resolution:

This action is a simple spinoff transaction in the accounting software, followed by an adjustment to the ticker symbol. It is structured to be a non-taxable event for LAC shareholders. The cost basis allocation information is calculated from the average of the opening and closing prices of LAAC and LAC on the October 4, 2023. This method to determine fair market value of the post spinoff companies is commonly used. IRS Form 8937 was not available from either company when these instructions were written.

NOTE:

The cost basis allocation is dependent on the prices used for both Lithium Americas Argentina and Lithium Americas Corp 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 available our instructions will use the guidance in form 8937. If your broker does not use that guidance, or form 8937 is not publicly available, 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 Accounting > Securities > Record spinoff of securities in myICLUB.com. If you are unfamiliar with spinoff transactions you can get help at this URL: https://www.myiclub.com/faq/article.aspx?id=54

Here is the information you need to complete the spinoff.

• Date: 10/4/2023
• Select Parent Security (or Parent Company) : Lithium Americas Corp (LAC)
• Remaining Basis Percentage: 63.56
• Cash received:  See your broker statement for cash-in-lieu received
• Spinoff  Security (or Symbol of New Company) : Lithium Americas Argentina (LAAC)
• Shares received : 1.0 x (# of LAC shares owned)   (Include fractional shares.)
  • For example, if you owned 100 LAC shares, you should receive 1.0 x 100 = 100 LAAC shares.
• Price Per Share : 6.37 (Average of high and low LAAC prices on 10/4/2023)                              

Save the transaction and the spinoff has been entered.

Ticker Symbol Adjustment

• Once the transaction has been entered, go to Accounting > Securities > Security Settings.
• On the security Settings page, click the Pencil/EDIT link next to Lithium Americas Corp with ticker LAC.
• On the next page, make sure the Quote Symbol boxes shows LAC; if it does not, change it to LAC.
• Click the Submit button, and you are done.