Chances are, if you invest in a growing company over a long period, you will experience a stock split. But what exactly is a stock split and how does it impact your cost basis, which is used to calculate capital gains taxes?
There are two types of stock splits: forward and reverse. The most common is a forward split, where a company splits its stock into smaller pieces. Splits are denoted in ratios. For example, a two for one split is shown as 2:1. For example, if you have 100 shares of Intel (INTC) stock, worth $100 a …Read More