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Correcting Stock Cost Basis for Long Held Shares

After many years of not checking security cost basis in Quicken, I want to bring Quicken into agreement with my broker's report. All my holdings in Quicken are in agreement with the data I download from the broker - but not the basis.
For stocks with only a few buy and sell transactions that occured recently this is straightforward: I just edit each of the historical sales and make sure the shares chosen to sell in Quicken are the same ones that my broker actually sold.
On the other hand I have some stocks that I have held more than 10 years with numerous buy and sell transactions. It is not practical to correct all these transactions: some, because of time elapsed, are no longer in the register and some are no longer available to view on the broker's website. Some have so many transactions that it is too complicated to unwind.
I need a method of adding a basis correction. This would be along the lines of what people do when they give up on trying to balance their checking account and just enter a "balance correction" transaction.
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  • NotACPANotACPA SuperUser ✭✭✭✭✭
    Have you ever sold securities in this account?  I suspect so.
    And, if so, did you choose the EXACT same lots (or portion of lots) to be sold as did your brokerage.
    That's the most likely cause of your discrepancy.
    In the absence of instructions to the contrary, your brokerage probably chose FIFO as the method to select lots.
    SO:
    1. Take a backup (just in case)
    2. Edit each SALE to select FIFO
    3. At the end (say of the 1st security that you edit) see if that resolved the issue.
    Q user since DOS version 5
    Now running Quicken Windows Subscription,  Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP
  • Jim_HarmanJim_Harman SuperUser ✭✭✭✭✭
    Or if you don't care about correcting the history and thus accept that Quicken will not be able to accurately track the basis for future partial sales, you could Remove all the shares of each problem security and Add them back in with the current basis and an artificial acquisition date consistent with whether they are long or short term holdings. 
    -- Jim QWin Premier subscription
  • NotACPANotACPA SuperUser ✭✭✭✭✭
    Also, when reporting Cap Gains on your income taxes, do you use Q's numbers? Or those from your brokerage?
    Hopefully, you use the brokerage's numbers.  Because adjusting the cost basis on prior year transactions for which you've already filed you taxes is "changing the past" and will almost certainly change the Cap Gains on those shares.
    Q user since DOS version 5
    Now running Quicken Windows Subscription,  Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP
  • Bruce_ATBruce_AT Member ✭✭
    Thank you all very much for your responses. I use my brokers 1099s as the basis for income tax reporting and Quickens numbers for mid-year planning. The suggestion that makes the most sense to me for the holdings that have too long a history and too many entries to clean up by reassigning historical sales is from Jim Q: Artificially move the shares out of the account using Quickens assumed basis and then move them back in with my brokers assumed basis.
  • Ron n Round RockRon n Round Rock Member ✭✭
    HI- I have the same problem, question. My Basis on some of my stocks is way off - got screwed up when I moved my account from one brokerage to another. I didn't realize it until I sold one of these stocks out of my new (existing) account - but Quicken is using the price of the stock on the account transfer date as the Basis instead of the real Basis.

    I see there are a lot of questions about doing a Basis adjustment and as Bruce mentioned above, I think the best way to handle this might be to artificially re-enter the stock purchase, to match the original purchase dates from the old account.

    That works for the stocks I am still holding, but is there a way to adjust the Basis on the stock that I just sold. My brokerage does it correctly (showing a $15K Realized gain in their records/report), but Quicken shows only a $3K gain because of the error in the Basis of the sold stock.

    Not a terrible big thing since I know about the error and the brokerage reporting is (will be) correct next year (I use TurboTax to downloaded the correct 1099 info), but I would still like to fix it so that I can, in Quicken, accurately track my stock sales for Capital Gains tracking, for next year. So is there a way to modify the Cost Basis being used in the Quicken Capital Gains Report.

    ron in kansas
  • Jim_HarmanJim_Harman SuperUser ✭✭✭✭✭
    @Ron n Round Rock,

    Assuming that the shares were moved "in kind" and not by selling and buying, one way to correct your situation would be:

    -- back up your data file in case something goes wrong

    -- make sure the holdings and tax lots prior to the transfer are correct in the old account, and correct if necessary.

    -- delete the transactions in Quicken that moved the security from the old account to the new

    -- enter a "Shares transferred between accounts" to move the shares. This will create one Removed in the old account for all the shares and one Added in the new account for each tax lot, preserving the original purchase date and cost basis.

    Note that this will not work correctly if you had partial sales in the old account and you have selected "Use average cost"
    -- Jim QWin Premier subscription
  • Ron n Round RockRon n Round Rock Member ✭✭
    Jim-

    Thanks for getting back to me. In the mean time, I noticed that my sister had the same problem (same situation - I am controlling her accounts for her) - and a stock that she moved (from one Schwab account to another) ended up with a "0" Basis (found that the Price in the ADDED transaction field was blank) - which resulted in the Capital Gains Report showing the entire Sell amount as a Capital Gains.

    Her situation was simpler (one stock, one purchase) - so I went to the ADDED transaction in her new account and plugged in the correct Basis - and AMAZINGLY this corrected Basis showed up correctly in the Capital Gains Report.

    So I guess it is that simple. Good ole Quicken must go back, somewhere, locate and pick up the original Buy (or Added) transaction each time the report is generated to use for the Basis. I guess it was my error in assuming that this value was locked in somewhere and couldn't be changed.

    So I am all fixed up, I think (assuming the same thing will work in my situation). I love Quicken (most of the time) - I have my life in there so-to-speak, 35+ years now. Just posting this as a solution for those interested. Wish I had opened a new Discussion now since it was a little different from your question since it was really a question about a Capital Gains Report.

    But thanks for your interest and response.

    ron in kansas
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