What are entries for entering Merger of Genomic and Exact Sciences

Ringo22

Merger took place on 11/12/2019 and I have yet to figure out correct entries to match USAA's capital gain of the Genomic shares removed and cost of Exact Sciences shares of added.

Tom Young

This is an easy "cash plus stock" transaction. 

Basically you sell your Genomic shares against "proceeds" of the cash received plus the "fair market value" of the Exact Sciences shares received.  Then you buy the requisite number of Exact Sciences shares at that same "fair market value."

Here's the Form 8937 that describes the transaction:

http://s22.q4cdn.com/877809405/files/doc_downloads/gov_docs/FORM-8937-signed.pdf

and that suggests a "fair market value" of the Exact Sciences shares of $82.39 but check to see what value your broker used in their 1099-B and they don't have to use that same number.

So, first thing to do is to back up you file and then, probably, delete the transactions downloaded from the broker.  (I say "probably" because it sounds like they sent you one or more "Removed" actions and what you want to do is to use a "Sold" action.)

1. Sell your Genomic shares against the total proceeds of actual cash plus fair market value of the Exact Sciences stock.  Include the fractional shares you should have received, (I'm assuming there was a "cash in lieu" transaction associated with all this.)  This will leave you with a gain, it sounds like, and a bunch of cash in the Account.
2. Using the same per share fair market value you used in step 1 buy the number of Exact Science shares, including the fractional shares, you should have received based on the number of shares of Genomic you tendered.
3. Sell the fractional share using the cash in lieu as the proceeds

You should end up with the correct gain on the sale, the correct cash in your Account and the proper number of shares of Exact Sciences properly priced.

Tom Young

This is an easy "cash plus stock" transaction. 

Basically you sell your Genomic shares against "proceeds" of the cash received plus the "fair market value" of the Exact Sciences shares received.  Then you buy the requisite number of Exact Sciences shares at that same "fair market value."

Here's the Form 8937 that describes the transaction:

http://s22.q4cdn.com/877809405/files/doc_downloads/gov_docs/FORM-8937-signed.pdf

and that suggests a "fair market value" of the Exact Sciences shares of $82.39 but check to see what value your broker used in their 1099-B and they don't have to use that same number.

So, first thing to do is to back up you file and then, probably, delete the transactions downloaded from the broker.  (I say "probably" because it sounds like they sent you one or more "Removed" actions and what you want to do is to use a "Sold" action.)

1. Sell your Genomic shares against the total proceeds of actual cash plus fair market value of the Exact Sciences stock.  Include the fractional shares you should have received, (I'm assuming there was a "cash in lieu" transaction associated with all this.)  This will leave you with a gain, it sounds like, and a bunch of cash in the Account.
2. Using the same per share fair market value you used in step 1 buy the number of Exact Science shares, including the fractional shares, you should have received based on the number of shares of Genomic you tendered.
3. Sell the fractional share using the cash in lieu as the proceeds

You should end up with the correct gain on the sale, the correct cash in your Account and the proper number of shares of Exact Sciences properly priced.

q_lurker

I agree with @Tom Young's assessment.  The key phrase from the cited Form 8937 is

The exchange of Genomic Health stock for the Merger Consideration was a taxable transaction for U.S. federal income tax purposes. As a result, a holder’s tax basis in each share of Exact Sciences common stock received in the merger will generally equal the fair market value of such share of Exact Sciences common stock as of the completion of the Merger.