E*Trade Fixing Return of Capital

BryanK

Hi, it looks like for a couple of my applicable holdings at E*Trade, for several years the downloaded transactions incorrectly categorized transactions- categorizing as dividend when they *should* have been return of capital, so for those holdings the cost basis is off. What is best way to fix? Just find all the past transactions and re-categorize as ROC? Or is there a "quick and dirty" way to just adjust the cost basis per lot to match ETrade? Thanks

Sherlock

In my opinion, the best way is correct the transactions.  If you don't, there are performance and tax report implications.  There is a "quick and dirty" way to just adjust the cost basis per lot by using Removed and Added transactions but it is likely easier to correct the transactions.

BryanK

Thanks that what I am going to do, it's not a lot to manually correct and should not take long. It looks like for these holdings the *entire* amount per download was categorized as a dividend in Quicken, but it was actually part dividend/part ROC. The failure to correctly break it out is probably on E*Trade's side. On the Tax 1099 it correctly breaks it down between dividend/ROC so I'll be using that to manually enter the ROC transactions thanks!

Tom Young

"The failure to correctly break it out is probably on E*Trade's side."

No, it's probably not.  Over the years I've had very, very few securities that attempt to track Return of Capital distributions in a timely fashion and actually disclose that information coincident with each distribution, and in those few cases the distributions are downloaded as "dividends", not sliced up between dividends and capital returns.

Over a lot of years, a lot of securities and more than a few brokers, I don't think I've ever had a RtrnCap downloaded to Quicken, I've always picked this info up off the 1099-DIV, received sometime in late January to sometime in February.