What is my cost basis for old Mirant stock distributed by Southern Company?
One method of computing your cost basis for tax purposes is to use the relative fair market value of Mirant and Southern stock at the April 2, 2001 closing prices. The closing price per share for Southern Company was $21.60. The closing price per share for Mirant was $34.60. Under this method, 38.91% of your former Southern Company cost basis would be allocated to the Mirant shares received in the distribution and the remaining 61.09% would be allocated to your Southern Company shares. There are other methods of computing cost basis and you should consult a tax advisor as to your particular tax situation.
