Spin offs--Problem with Mac

slips

Quicken for Mac has no transaction for a corporate spinoff (apparently available in Windows version--no surprise there). The corporation spinning off typically provides information on the allocation of basis between the spin off and the parent. In a recent transaction, IAC did a spinoff of Vimeo and allocated 68% (rounded off) of the total basis to IAC and 32% to Vimeo. The amount of the Vimeo basis is deducted from the IAC basis and is therefore entered as a Return of Capital. Ordinarily, the Vimeo shares received would be entered as Add Shares. But if you follow this procedure, your cash balance will be screwed up. Unfortunately, Quicken for Mac adds RofC to your cash balance (even though it is not income--see the note on the side of the RofC transaction). Therefore, in order to maintain the correct cash balance in your account, you have to record the spun off stock (in this case, Vimeo) as a Buy rather than Add Shares. Technically, the Buy date should be the original purchase of the IAC stock if you want to be precise for capital gains purposes.
Quicken should fix this. It's not as if stock spin offs do not occur with some frequency, and I assume that other Q for Mac users might have investment portfolios.

Tom Young

In the Windows version if there were no spinoff wizard I'd take your first step, then enter a deduction of that amount of cash with the offset being the same Account in which the transaction is recorded, then do an Add with the correct acquisition date. 

That second step, in Quicken for Windows, "magically" removes the cash without affecting any other Account or Category.

Don't know if that trick works in Quicken for Mac.

jacobs

@slips  Yes, indeed, there is a longstanding Idea thread (a request for a program enhancement) about adding corporate divestitures/spin-offs to Quicken Mac. You should go to this thread and add your vote (under the first post, in the yellow box, click the arrow under the vote counter).

That thread is marked "Under Consideration", meaning it has been pushed through to the development team, and they haven't yet committed to putting it on their development roadmap. The more people who vote for the topic, the greater the likelihood it will move up on their priority list.

maripow

Totally agree...In the Mac version there should be a spin-off selection. In the meantime, here's an example of how I've been handling it.

On June 3, Merck spun of Organon ;1 OGN for 10 MRK.
On June 3, MRK closed at $73.91; OGN closed at $37

Find cost allocation: 1 OGN for 10 MRK (1 x $37) + (10 x $73.91) = $776
then divide $37 / $776 = 4.77%

4.77% is the cost basis of MRK applied to OGN

You might have to do it separately for each block, but it's simple arithmetic. Why can't some Quicken programmer just code that?