How do I enter an Exchange MMM to NEOG

firecop8

Shares of 3M (MMM) were exchanged for shares of Neogen Corp (NEOG)?

Tom Young

Here's my "10,000 foot" take on the transaction based on some quick reading:

1. The first action was a split-off whereby you ended up with fewer shares of 3M and 6.7713 shares of Garden Spin-co for each 3M shares tendered.
2. You then tendered all your shares of Garden Spin-co and received shares of Neogen on a 1-for-1 basis.

You can ignore Garden Spin-Co in all this and simply deal with your 3M shares and your Neogen shares.

Tax-wise each lot of 3M that got tendered carries over all its attributes - cost basis and holding period - to the Neogen shares received, at no gain or loss, except for fractional shares not distributed to you.  The Cash in Lieu  received for a fractional share will be treated as the "proceeds" of the sale of the fractional share at a gain or loss.

If I've got this right then you're going to have to make manual entries in Quicken to get the proper accounting since there's no "wizard" for a split-off.  I'd advise waiting for a few days to see what further information might be forthcoming from either company and to see how your broker handles the details in your brokerage account.

Basically, you'll do a Remove entry for each lot of 3M shares tendered and then do an Add entry for the resulting shares of Neogen received.  Then you'll sell the fraction of a share.

firecop8

Thanks. No worries about taxes as all is in an IRA.

firecop8

I think I will enter MMM as a sale and NEOG as I purchase all at the same price of NEOG on the conversion date. Since they are in IRAs no need to worry about taxes.