specific lot selection for stock sells

deathrs
deathrs Quicken Windows Subscription Member ✭✭✭
in Investing (Windows)

I am having a problem with the accuracy of the screen where you specify what stock lot you are selling shares. Here is my story..

I was comparing my Quicken Capital gains report to that of my Broker and while there are always some differences. I decided to look at a specific stock in a specific account at fidelity. The differences stemmed from the fact that my broker's information on selected lots was different than what was in Quicken lot history. Since I manually select which lot for Quicken to use when I reconcile with my brokers sell transaction, they should match. When they don't, that of course creates the difference between the two capital gains reports.

Here is an example of what I found.

I purchased 5.31 shares 8/6/24. Everything matched up correctly. Broker transaction report and holding report matched Quicken transaction report and holding report.

the next transaction date was 1/3/25 of 2.51 shares of the security. Again, all reports agreed. when I looked at the specify lot screen, the previous buy of the 5.31 shares was listed as available. The sale of the 2.51 shares was from another lot, so it didn't affect the 8/6/24 lot. So, all is good at this point.

The next transaction was 3/11/25, a sell of 5.31 shares from the lot dated 8/6/24. All the transaction reports agree and reflect the sell correctly. Now the problem, when I look at the specify lot screen. the 5.31 shares that were available previously, now only reflect 2.8 shares available. In addition, it reflects 2 shares available for lot 7/5/22 and .51 shares available for lot 6/14/22. those were not present in prior screens. So for some reason, Quicken has split the 5.31 shares of lot 8/6/24 into three lots, with no transactions to support it.

I have started back from the beginning and checked every transaction. I have done the validate file and rebuild lot file with no impact or change. I have deleted and reentered the 8/6/24 buy transaction for 5.31 shares with no change. It apparently is something that happened between 1/3/25 and 3/11/25. even though there is no activity reflected on the transaction reports.

In the scheme of things, this is a relatively minor issue, as I would use tax forms from my broker. I just wondering if anyone has a solution or suggestions.

Thank you

Comments

  • q_lurker
    q_lurker Quicken Windows Subscription SuperUser ✭✭✭✭✭

    a) I'd be looking for a hidden placeholder transaction. Be sure your preference setting include showing hidden transactions.

    b) My reading of this is that while accepting or editing the 3/11/25 sale transaction you are not seeing the right lots available. My other thought in these cases is to delete and re-enter the sale transaction. but that does not seem to be necessary here. You might consider going back through historical transactions and deleting / re-entering prior sales.

    c) If you enter a sale on any date between 1/3/25 and 3/11/25, do you get the right lot selection options?

    You wrote "The next transaction was 3/11/25, a sell of 5.31 shares from the lot dated 8/6/24."

    Is this rephrasing also correct? "The next transaction was 3/11/25, a sell of shares that would include the 5.31 shares of the lot dated 8/6/24."  That is the 3/11/25 sale was a bigger sale than just the 5.31 shares. Just want to have a clear understanding.

  • Tom Young
    Tom Young Quicken Windows Subscription SuperUser ✭✭✭✭✭

    What you might be facing - I say this because you're buying and selling lots in close proximity to one another - is that you're being affected by the wash sale rules. This is almost a certainty if any of those sales are sales at a loss. The wash sale rules require that you defer the loss and the deferred loss gets added to your basis in the stock, and the broker is following required to make those adjustments, adjustments that, most likely, are not being reported to you, it's all done behind the scenes.

  • deathrs
    deathrs Quicken Windows Subscription Member ✭✭✭

    q_lunker : I went back and reread my comments, I should have been a little more clear.

    8/6/24- the buy of 5.31 shares is correct on all reporting.

    1/3/25- the next transaction, was a sell transaction of 2.51 shares, but from another lot it was ok and all report agreed. when I look at the "specify lot screen" to the lot (12/15/16) for the 2.51 shares was correct and I could see that the 5.31 shares from the 8/6/24 was available. So, all good.

    3/11/25- was the next transaction for a sell of 5.31 shares of lot 8/6/24. when I go to the specify lot screen, now it only shows 2.8 shares available for lot 8/6/24 instead of the 5.31 shares that was reflected on the screen on 1/3/25. there were no transactions listed at the broker or in quicken between 1/3/25 and 3/11/25. In addition to the change of shares available for lot 8/6/25, the screen also reflects 2 shares for lot 7/5/22 and .51 shares for lot 6/14/22, these were there 1/3/25. When you total them, they equal the 5.31 shares.

    There were two transactions after the 3/11/25 on 4/14/25 and 5/6/25 and they are correct.

    I did a test as you suggested, I entered a sell and a buy transaction between 1/3/25 and 3/11/25 and they both appeared correct on the specify lot screen. I did delete and renter the transaction, but only from 8/6/24. there was no change. when I have a moment to "play" I'll start from the beginning. That is 2016, so would take a while. I don't see any placeholders, splits, or odd transactions and the show hidden transactions box is checked.

    Tom Young: I understand what you are saying about the "wash sale rule", that would affect the cost basis. This would be reflected in the cost basis dollar per share. The basis per share seems to be correct when compared to my broker and transaction in Quicken. I think Quicken would adjust the cost per share and not the share count, if it sees a different cost basis.

    At any rate, I appreciate both of your suggestions, and will keep looking.

    Thanks

  • deathrs
    deathrs Quicken Windows Subscription Member ✭✭✭

    sorry guys I can't type, q_lunker in my update commentary, the 3/11/25 paragraph should have read,

    the screen also reflects 2 shares for lot 7/5/22 and .51 shares for lot 6/14/22, these were NOT there 1/3/25. When you total them, they equal the 5.31 shares.

    sorry for the confusion…

  • q_lurker
    q_lurker Quicken Windows Subscription SuperUser ✭✭✭✭✭

    As far as I am concerned, delete and reentry apply to sales only. The principle, in my mind is that if somehow the sale tags the wrong lots, deleting the sale clears that error. If one went to the extreme and deleted all sales, one could then start from scratch on assigning lots. I am not pushing that as advice though - to delete all sales.

    Another aspect to recognize is the consideration of sequence of entry and date of transaction. Suppose you have three lots 1, 2, and 3) on March 1. You enter a sale dated May 1 specifying lot 2. You then enter a sale dated April 1. Lot 2 will not be available for the earlier April sale because the later May sale has already spoken for that lot even though logically the April sale could have used lot 2. That can lead to needing to at least edit all subsequent sales to use the default lot assignment (no lot specification), and then progressively move through old sales to new sales matching the desired lot assignments. Again, I can’t tell if that sort of sequence might be a factor for you or not, but I wanted you to be cognizant of the possibility.

  • deathrs
    deathrs Quicken Windows Subscription Member ✭✭✭

    I will keep playing with it. There is something in the logic that is playing with the specify lot screen. lots available disappear with no apparent reason and then reappear at a future date. This makes me think that you are correct. There is something happening when there are multiple sell transactions on the same date. Somehow Quicken logic to reserve a lot quantities and get confused if I manually select a different lot. i will keep looking.

    Thanks

  • deathrs
    deathrs Quicken Windows Subscription Member ✭✭✭

    Still working on the specific lot screen process. I have not found a common denominator. Sometimes the lot screen matches actual with no problem. this is most probably with simple Buy /Sell transactions and a single lot. The lot screen starts to get "buggy" when you sell stock from multiple lots. I think that it has to do with the sequence of how the transactions are Entered/downloaded, IE: a sell transaction is entered before buy transaction. the lot screen gets confused.

    Another issue are special transactions such as stock splits or spin offs and you have multiple stock lots. I think this confuses the lot screen logic. The split/spinoff wizards enter a "remove share" transaction, then enter a share added transaction. This seems to work fine if there is only one share lot. However, if there are multiple share lots and multiple previous transactions from those share lots. This is where the specific lot screen does some odd added share back stuff. it does not add back to the correct share lot.

    Of course, I am not sure fixing this is worth the effort. It only prevents Quicken from balancing with my broker's statement in determining cost basis. I'll keep looking….

  • deathrs
    deathrs Quicken Windows Subscription Member ✭✭✭

    another discovery (at least on my part), that contributes to the confusion on the specific lot screen. Today, I downloaded transaction activity from fidelity. all transactions appeared in Quicken. There were several security sell transactions. When accepting the sell transaction as is normal, when there are multiple lots of a security available, a "pop-up" screen appears so that you can select share from the proper lot. no problem. When there is only one lot available, the "pop-up" screen does not appear and there is no opportunity to select a lot. This is logical since there is only one lot available to select.

    This is where it gets confusing. When you go back and look at the lot screen for those securities that only had a single lot available. The specific lot screen does not show the sold shares as allocated to the lot. IE: I have 100 shares in a single lot. the specific lot screen shows 100 shares available. I enter a sell transaction for 50 shares, Quicken accepts the transaction with no opportunity to specify the lot. When I look at the specific lot screen, it still shows 100 shares available, even though it shows the sell 50 shares on the transaction report.

    I am not sure if it is just the "specific lot" screen that is in error, the math behind the transaction screen is correct and reflects the correct share balance. I believe it is a problem in how Quicken updates the specific lot screen.

  • NotACPA
    NotACPA Quicken Windows Subscription SuperUser ✭✭✭✭✭

    Unless you instructed the broker to use specific lots when you placed the order, the brokerage almost certainly used FIFO in the lot selection.

    The lots involved in a sale isn't downloadable … there's just no provision for that in the OFX/QFX specs.

    SO, you can change your records in Q to match what the brokerage did (which is probably your only choice for prior transactions) OR you can give the brokerage more specific instruction for future transactions.

    RE: those past transactions, it also means that the IRS 1099 that you receive won't match your records in Q, thus impacting your tax reporting to the IRS.

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

  • deathrs
    deathrs Quicken Windows Subscription Member ✭✭✭

    Thanks for your help and quick reply. I probably wasn't too clear in my previous comments.

    You are correct in that the download from the broker does not have Lot specific info. I get the lot specific info that the broker used by generating the capital gain report on the broker's site for my accounts.

    when I am accepting the downloaded transaction in Quicken, if there are multiple lots available for that specific security. Quicken will ask to specify lots and I specify the lot that the broker used for that sell.

    where I detect a problem in Quicken, is when the downloaded transaction only has a single lot available for the specific security, Quicken knows there is no choice of lots so it does not show the "pop-up" screen to let me select a lot. This in itself is a correct process.

    Where I see a problem, is with those single lots that Quicken did the automatic allocation. After the transaction is accepted and reconciled in Quicken, and I go and look at "specific lot" screen, it does not show the shares as allocated to that single lot.

    If I look at a security that I manually allocated share, because there were multiple lots, they have been allocated correctly.

    So, this is what is confusing me. It may just be a problem with the specific lot screen and not the math behind it. I have been seeing some odd things with the "specific Lot" screen.

    Thanks again

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