Non Dividend Distros and Return of Capital

Michael Loy
Michael Loy Member ✭✭
edited March 2023 in Reports (Windows)
Form 1099's report Return of Capital which is entered in QUICKEN as an ACTION [RtrnCapX]. This also shows up on the 1099 Report as a box 3 [Nondividend Distributions].
However, I can't find any QUICKEN Tax Report that contains this entry after the RtrnCapX posting.
How does QUICKEN get this info to the tax Accountant?

Answers

  • Jim_Harman
    Jim_Harman SuperUser ✭✭✭✭✭
    In general RoC distributions are not taxable. That is why they don't appear on Quicken's tax reports. See
    https://www.investopedia.com/terms/r/returnofcapital.asp

    Disclaimer: I am not a tax advisor. You should discuss this with your tax accountant.
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  • Michael Loy
    Michael Loy Member ✭✭
    Jim,
    Thanks for responding. I understand the immediate tax ramifications of Return of Capital, but because it IS reported to the IRS my tax accountant queries me about why I haven't provided her the info suspecting that my records are deficient. An added line in the QUICKEN Tax Summary would so provide.
    QUICKEN Developers take note?
  • NotACPA
    NotACPA SuperUser ✭✭✭✭✭
    So, you want a Q Tax report to include a non-tax txn?  Ain't never gonna happen.
    Try showing your marginally competent advisor an Investment actions report

    Q user since February, 1990. DOS Version 4
    Now running Quicken Windows Subscription, Business & Personal
    Retired "Certified Information Systems Auditor" & Bank Audit VP

  • Tom Young
    Tom Young SuperUser ✭✭✭✭✭
    Well, charitably, there's nothing wrong with including a ROC on an income tax return, it just doesn't go anyplace in the income tax return EXCEPT if cumulative ROCs entirely eliminate your basis in the security, maybe even resulting in having to report capital gain.  Maybe the tax accountant is keeping his/her own records of basis "just in case?"  Just make a note of the ROC when you send in your tax information to the accountant.
  • Jim_Harman
    Jim_Harman SuperUser ✭✭✭✭✭
    If you want a Quicken report that shows the ROC transactions, you can customize an Investing > Investment Transaction report to include just the RtrnCap and RtrnCapX Actions. You can subtotal by account if you want.

    You must look carefully to find these in the Actions list, it is not in alphabetical order.
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  • q_lurker
    q_lurker SuperUser ✭✭✭✭✭
    You should be providing the accountant the 1099's moreso than Quicken reports.  From my seat, the Quicken reports should augment and support the 1099 information but should not be used to fully duplicate the 1099 information.  That your Quicken reports likely do not separately report Qualified (vs non-Qualified) Dividend income is a similar point where the Quicken information cannot duplicate the 1099 information   

    On a sidebar comment:  you indicated you used a RtrnCapX transaction.  Typically, through the course of the year, I have recorded the distribution for the company as a dividend and find at the end of the year some is ROC and some is taxable dividend.  As an end of year adjusting transaction, I would have one RtrnCap transaction (cash into account) and one MiscExp transaction same amount (cash out of account) with that expense categorized against the _DivInc category.  In that fashion, my taxable dividend income is corrected downward whereas before that pair, the dividend income had been overstated.  In some cases, it is required to make those adjustments in a more timely manner rather than at end of year.  
This discussion has been closed.