Entering Reinvested Dividends

Greg_the_GeekGreg_the_Geek SuperUser ✭✭✭✭✭
edited February 2017 in
I'm using Quicken 2006 H&amp_B and I'm a little confused about entering reinvested dividends. Each Dividend has a Gross Amount, Net Amount (Gross - Fee), Price Per Share, Transaction Shares and Tax Basis Per Share. When I enter the transaction in Quicken, I enter the Action as ReinvDiv, the Gross in the Dividend Amount, the Transaction Shares in the Dividend Shares and the Fee in Commission Amount. Quicken removes the Commission Amount and creates a second transaction of type MiscIncX with the Fee amount. The Quicken share price doesn't equal either the Price Per Share or the Tax Basis Per Share. Am I entering the amounts incorrectly?
Quicken 2017 H&B - Windows 10

Comments

  • jepollardjepollard Member
    edited August 2016
    > I'm using Quicken 2006 H&B and I'm a little confused> about entering reinvested dividends. Each Dividend> has a Gross Amount, Net Amount (Gross - Fee), Price> Per Share, Transaction Shares and Tax Basis Per> Share. When I enter the transaction in Quicken, I> enter the Action as ReinvDiv, the Gross in the> Dividend Amount, the Transaction Shares in the> Dividend Shares and the Fee in Commission Amount.> Quicken removes the Commission Amount and creates a> second transaction of type MiscIncX with the Fee> amount. The Quicken share price doesn't equal either> the Price Per Share or the Tax Basis Per Share. > Am I entering the amounts incorrectly?No.  Ignore the price/share, it is not important. I have no idea what you mean by the "tax basis per share"_ as far as I know, that is meaningless.  Quicken does correctly retain your cost basis ... per lot ... which is what you need to know for tax purposes.  (Number of shares purchased in a transaction and the total cost of those shares is all that matters).
  • TodTod Member
    edited August 2016
    > I'm using Quicken 2006 H&B and I'm a little confused> about entering reinvested dividends. Each Dividend> has a Gross Amount, Net Amount (Gross - Fee), Price> Per Share, Transaction Shares and Tax Basis Per> Share. When I enter the transaction in Quicken, I> enter the Action as ReinvDiv, the Gross in the> Dividend Amount, the Transaction Shares in the> Dividend Shares and the Fee in Commission Amount.> Quicken removes the Commission Amount and creates a> second transaction of type MiscIncX with the Fee> amount. The Quicken share price doesn't equal either> the Price Per Share or the Tax Basis Per Share. Am I> entering the amounts incorrectly?Note: Following comments are based on Q2005 Deluxe.  I don't normally have fees on my ReinvDiv so I checked it out.  I tried a setup of Gross Div = 100Fee = 2Net Div = 98Shares = 7.  This should associate to a "purchase" price of $14/share but a tax basis of $14.2857/share.  The "purchase" price is immaterial.  I followed your model with the Gross into the Dividend Block and was surprised to see the fee initally added to the price as if the total transaction used $102.  Two transactions are entered - the ReinvDiv for 7 shares at 14.2857/share = $100 followed by a MiscIncX of $2.00 transferred into the same account with a category of _DivInc.  A tax summary report including these transactions reports $102 of dividend income.  (I am not clear on the MiscIncX transaction.  In the transaction register, this shows as a red -$2.00_ Editting the transaction it appears as a black +$2.00 Miscellaneous amount.  There is no change in the account cash holdings.)My initial conclusion then was that you should report Net Div in the Div block and the Fee in the Commission block.  But the sell following that transaction treats the basis as $98 and thus overreports cap gains ignoring the commission.  Thus I finally conclude that you should enter the gross dividend in the Dividend block and NOT enter the fee as a commision.  I do not think Q (2005 Deluxe) handles the commission correctly.
  • jepollardjepollard Member
    edited August 2016
    > > I'm using Quicken 2006 H&B and I'm a little> confused> > about entering reinvested dividends. Each Dividend> > has a Gross Amount, Net Amount (Gross - Fee),> Price> > Per Share, Transaction Shares and Tax Basis Per> > Share. When I enter the transaction in Quicken, I> > enter the Action as ReinvDiv, the Gross in the> > Dividend Amount, the Transaction Shares in the> > Dividend Shares and the Fee in Commission Amount.> > Quicken removes the Commission Amount and creates> a> > second transaction of type MiscIncX with the Fee> > amount. The Quicken share price doesn't equal> either> > the Price Per Share or the Tax Basis Per Share. Am> I> > entering the amounts incorrectly?> > Note: Following comments are based on Q2005 Deluxe.>  > > I don't normally have fees on my ReinvDiv so I> checked it out.  I tried a setup of > Gross Div = 100> Fee = 2> Net Div = 98> Shares = 7.  This should associate to a "purchase"> price of $14/share but a tax basis of $14.2857/share.> The "purchase" price is immaterial.  I followed your> r model with the Gross into the Dividend Block and> was surprised to see the fee initally added to the> price as if the total transaction used $102.  Two> transactions are entered - the ReinvDiv for 7 shares> at 14.2857/share = $100 followed by a MiscIncX of> $2.00 transferred into the same account with a> category of _DivInc.  A tax summary report including> these transactions reports $102 of dividend income.>  > > (I am not clear on the MiscIncX transaction.  In the> transaction register, this shows as a red -$2.00_> Editting the transaction it appears as a black +$2.00> Miscellaneous amount.  There is no change in the> account cash holdings.)> > My initial conclusion then was that you should report> Net Div in the Div block and the Fee in the> Commission block.  But the sell following that> transaction treats the basis as $98 and thus> overreports cap gains ignoring the commission.  > > Thus I finally conclude that you should enter the> gross dividend in the Dividend block and NOT enter> the fee as a commision.  > I do not think Q (2005 Deluxe) handles the commission> correctly.On reinvestments_ I agree.  But you can approach this slightly differently.Instead of trying to use a Quicken "Reinvestment" transaction, enter a "Div"idend transaction for the gross dividend, followed by a "Bought" transaction for the gross dividend with the appropriate commission/fee.  I think Quicken gets it right when you enter it this way.
  • Greg_the_GeekGreg_the_Geek SuperUser ✭✭✭✭✭
    edited February 2017
    Here's the actual figures from my last statement:Net Dollars: 8.22Fee Deducted: 0.91Price Per Share: 19.6651Transaction Shares: 0.418Tax Basis Per Share: 19.6901How should I enter this transaction? If I enter the Gross amount (Net + Fee), Quicken calculates the per share price to be $21.842105. If I enter the Net amount, Quicken calculates the per share price to be $19.6651 but the Gross amount will be shown on the 1099-DIV.
    Quicken 2017 H&B - Windows 10
  • jepollardjepollard Member
    edited August 2016
    > Here's the actual figures from my last statement:> > Net Dollars: 8.22> Fee Deducted: 0.91> Price Per Share: 19.6651> Transaction Shares: 0.418> Tax Basis Per Share: 19.6901> > How should I enter this transaction? If I enter the> Gross amount (Net + Fee), Quicken calculates the per> share price to be $21.842105. If I enter the Net> amount, Quicken calculates the per share price to be> $19.6651 but the Gross amount will be shown on the> 1099-DIV.Thanks to the "new format" here, AND the fact that you did not "quote" anyone_ I have no idea who you are talking to.If you are addressing me, your post does not make sense: re-read what I posted. What I suggested does not have much to do with all the numbers you quote: enter what I said and your results will be correct.  And FORGET about the price/share: it is meaningless.Also, I believe that you now have a definitive answer to this question from R.C. White in the Quicken Newsgroup.  His answer trumps anything said here, including my response.  If you have not done so in the near future, I will be copying his response here so others can benefit.
  • Greg_the_GeekGreg_the_Geek SuperUser ✭✭✭✭✭
    edited February 2017
    > Thanks to the "new format" here, AND the fact that> you did not "quote" anyone_ I have no idea who you> are talking to.> > If you are addressing me, your post does not make> sense: re-read what I posted. What I suggested does> not have much to do with all the numbers you quote:> enter what I said and your results will be correct.> And FORGET about the price/share: it is> s meaningless.> > Also, I believe that you now have a definitive answer> to this question from R.C. White in the Quicken> Newsgroup.  His answer trumps anything said here,> including my response.  If you have not done so in> the near future, I will be copying his response here> so others can benefit.I'm sorry John, I should have quoted your post to which I replied. After reading R.C. White's post in the newsgroup and your post here, I now understand that it is 2 seperate transactions. Thank you very much for taking the time to reply and help me with my problem. It's posters like yourself and R.C. that make these forums/newsgroups such a valuable resource.Greg
    Quicken 2017 H&B - Windows 10
  • jepollardjepollard Member
    edited August 2016
    For others following this discussion, here is a link to the same subject in the Quicken newsgroup.  I think some will be surprised at R.C. White's first post in the thread, particularly about the fee: it may not be intuitive to ignore the fee, but it makes sense to me ... and R.C. knows his stuff.<url>http://groups.google.com/group/alt.comp.software.financial.quicken/browse_thread/thread/31e0a245ee1b78f7/c01daa3e62db1a8c?lnk=st&q=group%3Aalt.comp.software.financial.quicken+author%3AR.C.+author%3AWhite&rnum=3&hl=en#c01daa3e62db1a8c</url&gt;
  • Community UserCommunity User Member ✭✭
    edited July 2016
    > For others following this discussion, here is a link> to the same subject in the Quicken newsgroup.  I> think some will be surprised at R.C. White's first> post in the thread, particularly about the fee: it> may not be intuitive to ignore the fee, but it makes> sense to me ... and R.C. knows his stuff.> > <url>http://groups.google.com/group/alt.comp.software.&gt; financial.quicken/browse_thread/thread/31e0a245ee1b78f> 7/c01daa3e62db1a8c?lnk=st&q=group%3Aalt.comp.software.> financial.quicken+author%3AR.C.+author%3AWhite&rnum=3&> hl=en#c01daa3e62db1a8c</url>By doing the two transactions, don't you now throw off your "Amount Invested" which affects your ROI. I guess it would depend how you view a cash dividend - I look at it as a return in that account, not "out-of-pocket" income that I invest. In Quicken, a single ReinvDiv transaction does not add to your Amt. Invested, where the Div then Buy method does.I may be way off - I'm by no means an accountant - but I would love to know why the ReinvDiv transaction treats the commissions this way
  • jepollardjepollard Member
    edited August 2016
    > > For others following this discussion, here is a> link> > to the same subject in the Quicken newsgroup.  I> > think some will be surprised at R.C. White's first> > post in the thread, particularly about the fee: it> > may not be intuitive to ignore the fee, but it> makes> > sense to me ... and R.C. knows his stuff. < snip >> By doing the two transactions, don't you now throw> off your "Amount Invested" which affects your ROI. I> guess it would depend how you view a cash dividend -> I look at it as a return in that account, not> "out-of-pocket" income that I invest. In Quicken, a> single ReinvDiv transaction does not add to your Amt.> Invested, where the Div then Buy method does.To my knowledge all real-world reinvestments are actually two transactions: a dividend and a buy.  I can not think of any reason to treat a Quicken "reinvestment" transaction any differently than a dividend followed by a buy.  If there is some problem (like being sure it was really the dividend that funded the buy), perhaps a new Action code would help: BuyWithDividend.> I may be way off - I'm by no means an accountant -> but I would love to know why the ReinvDiv transaction> treats the commissions this way--John PollardPlease post questions in the forums, not via email.Message was edited by         jepollard     at {1}
  • Community UserCommunity User Member ✭✭
    edited July 2016
    Duh - I apologize - ROI stays fine in both scenarios - The single ReinvDiv doesn't increase "Amt Inv." but does add it to "Amt. Reinvested" - so the "Return" is the same and ROI is calculated correctly. So, just like you said John, the two separate transactions are the way to go - as long as you can live with it going in Amt Invested - hence your point about BuyWithDividend.Thanks John - as usual....
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