Cost basis for reinvested dividends - Merrill Edge

brownmandad

Quicken shows the cost basis for reinvested dividends as 0. I double-checked with Merrill Edge from where these transactions are downloaded and it seems to track the cost basis correctly.

Jim_Harman

@Sherlock, it appears that Merrill is still sending the transactions described in the discussion I linked above:
Div
Withdraw of the dividend amount
Added for the reinvested shares, with a cost of zero.

The linked discussion describes a couple of work-arounds.

It is certainly a bummer that Merrill has not fixed this. It is probably an artifact of their systems transferring the dividend to a DRIP account and buying the shares there.

The earliest reference to this problem I found dates to 2015.

Sherlock

I suggest you correct the transactions used to record the reinvested dividends in the account register.

brownmandad

Thanks. I did not do anything except downloading the transactions from Merrill Edge to Quicken.
I notice now that Quicken just adds the new shares, so the cost is zero. How do I correct this? This must have gone on for ages.

Jim_Harman

Does this discussion describe the situation you are seeing?
https://community.quicken.com/discussion/comment/20115898#Comment_20115898

If so, this has apparently been a problem for a long time, with no resolution from Merrill. You can work around it by following one of the approaches described in the linked discussion.

If you are seeing something different, please describe what transactions are downloaded instead of the ReinvDiv with the correct dividend amount and share quantity.

I edited your title to show tht this is Merrill Edge related.

Sherlock

brownmandad said:

Thanks. I did not do anything except downloading the transactions from Merrill Edge to Quicken.
I notice now that Quicken just adds the new shares, so the cost is zero. How do I correct this? This must have gone on for ages.

The instructions depend on the current transactions and how you prefer to track performance. 

It sounds like you may have been accepting placeholders for the reinvested dividends.  If so, you may want to review: Quicken FAQ: Managing Placeholder Entries in Quicken for Windows

Reinvested dividends may be entered as distinct Div and Bought action transactions or an ReinvDiv action transaction however Quicken measures the investment performance differently depending on which approach is used: https://help.quicken.com/display/WIN/Tell+me+about+key+investment+performance+calculations+used+in+Quicken   If you're importing transactions, we usually suggest using the approach provided by the financial institution.

Jim_Harman

@Sherlock, it appears that Merrill is still sending the transactions described in the discussion I linked above:
Div
Withdraw of the dividend amount
Added for the reinvested shares, with a cost of zero.

The linked discussion describes a couple of work-arounds.

It is certainly a bummer that Merrill has not fixed this. It is probably an artifact of their systems transferring the dividend to a DRIP account and buying the shares there.

The earliest reference to this problem I found dates to 2015.

Sherlock

Jim_Harman said:

@Sherlock, it appears that Merrill is still sending the transactions described in the discussion I linked above:
Div
Withdraw of the dividend amount
Added for the reinvested shares, with a cost of zero.

The linked discussion describes a couple of work-arounds.

It is certainly a bummer that Merrill has not fixed this. It is probably an artifact of their systems transferring the dividend to a DRIP account and buying the shares there.

The earliest reference to this problem I found dates to 2015.

I agree.  Since we don't use Merill, I cannot confirm whether or not they've addressed their issue.

brownmandad

Thanks to everyone. I followed the approach suggested by Jim and have started correcting the Merrill register. Looks fine. Fortunately, my Merrill account is only 5 years old.