Problems with Capital Gains Export

Chuck Cobb

I have been using Quicken and TurboTax for all my finances and taxes for at least 10 years.  For all of those years, I have used the procedure that Intuit recommends for capital gains exporting which is described here:

https://www.quicken.com/support/how-transfer-tax-information-quicken-turbotax

For all of those years, I trusted that I was accurately reporting my capital gains but I am now losing confidence in that process.  

When I attempted to do a capital gains export this year, I saw some fairly large capital gains I wasn't expecting.  That caused me to start looking deeper to see what was wrong.  The most obvious problem I found was that there were a number of share conversions that had a zero cost basis because the cost basis wasn't transferred over during the share conversion.  I was able to manually fix that by going back and finding all the zero cost basis transactions and fixing them.  

Then I tried to match the capital gains report data against a capital gains report from my financial institution and only a few of the capital gains/losses matched.  I download all my transactions directly from financial institutions almost daily and I put a lot of work into regularly reconciling all of my accounts to be sure that the Quicken data agrees with the data from the financial institutions.  I am sure that all the assets match and the valuations also match - how is it possible for the capital gains to be so far off?  I need to be able to trust this capability in Quicken because the alternative of entering all these transactions manually is so time-consuming and tedious.  Any help will be greatly appreciated.

Thanks,

K.O. (Win-Premier)

With respect to taxes you should not rely on Quicken's capital gains report.  It doesn't handle wash sales.  It doesn't handle 1256 contracts.  It doesn't account for short sales correctly.  It doesn't handle options correctly.  And ... if the lots in Quicken are not the exact same lots you sold at your brokerage that will cause it to be different than what you broker provides.

Short answer, stick w/ what your broker provides.

q_lurker

Relying on your brokerage to properly download all transactions is the heart of your problem.  It is (I'll suggest) common that for a 'conversion' type of situations (MF conversions, spinofffs, mergers, etc.), the brokerage is unlikely to pass along adjusted cost basis information.  If you have Quicken perform the conversion, your chances of getting the data right improve, IMO, but still need to be checked and manual entries may still be needed.  

I'd say 99% of the time, I get my Quicken cap gains report to agree with the brokerage data, and the brokerage data may be insufficient for longer held (uncovered) securities.  

Once I have the agreement , I have no problem transferring cap gain information to TurboTax.