How do I enter an "EXCHANGE" of Stock in Quicken?

Even though it's a mutual fund, a corporate acquisition should work. Unless, of course, you have the fund in a "single mutual fund" account.

Regardless, just renaming the fund should achieve what you want.

I agree with Fred's 1st answer -- Corporate Acquisition (stock for stock)

This is the best way to haave accurate reports, showing that you hold ABC until MM-DD-YYYY and then hold XYZ thereafter. (Actually, the reports will treat the transaction as occuring at the open of MM-DD- YYYY.) And it preserves the basis of each lot (purchase, dividend rreinvestment or capital gain reinvestment).

Please note that this will generate a lot of transactions -- 1 Remove ABC transaction and a proliferation of Add XYZ transactions, 1 Add for ever purchase, dividend reinvestment and capital gains reinvestment you have had over the years.

Fred's 2nd answer -- change the fund's name --is simplest, but it results in your reports showing that you owned XYZ at a time when you actually did not.

-dll

I think you need to provide more information before anyone can give you a correct answer.

What exactly do you mean by "EXCHANGE"? Did you [or your broker] initiate this transaction? - reallocation or other reason? Was this in a taxable or a tax deferred account? - possibly a tax- exempt fund?

If this was a true Sell/Buy sequence, then that is what you enter in QW. The cost basis in the new fund, XYZ, is what you paid for it - period!! You would likely have capital gains/losses in a Sell/Buy sequence.

Proper accounting for cap gains/losses is critical if this was a taxable event - perhaps not critical if a non-taxable event.

Hi, Ira.

As JM said, we need a lot more information before we can give an intelligent answer.

First, the Internal Revenue Code taxes gains on "sales and exchanges". In other words, an exchange of properties is just as taxable as a sale. Gain or loss is measured by subtracting your adjusted basis for the property traded away from the fair market value of the property received. Fair market value for the two properties is deemed to be equal and set at whichever can be more easily and accurately determined.

Second, there are many exceptions to the general rule. These exceptions are all spelled out in code sections written by Congress to accomplish certain governmental goals. Many corporate transactions are very carefully structured by management (with advice from attorneys and CPAs) to fit within one of these exceptions. In order for us to know how a particular transaction is to be treated for tax purposes, we need to read the voluminous documents from corporate management to see which code section applies.

Was your mutual fund exchange engineered by the fund managers to fit a code section? (This is not too unusual when managers are re-aligning funds within the "family".) Or was it a straightforward exchange that you initiated by calling your broker and saying that you think XYZ looks better than your ABC, so please swap them for me? (In that case, you would treat it as a sale of your ABC and a purchase of XYZ. All prior basis numbers and dates would be forgotten after the ABC sale is recorded.) Or did the exchange happen in some other way?

If this is an management-initiated exchange, you should have received information about what happened "in the real world". With that, you should be able to figure out how to record it in Quicken - and we'll be glad to help. You also should discuss this with your own CPA and broker.

RC

I am so pleased that you have all taken the time to respond. I still have not yet taken action because CORPORATE ACQUSITION requires more information (something about a per share price being offered).

However, I cannot answer your kind questions for more information. If I had it, I certainly would have provided it.

The best I can say is that my merrill lynch statement showed up with the following:

E = AXA Enterprises Small Co Value G = Goldman Sachs Structured Small Cap Value B

It was not a sale and purchase (that would be SELL and BUY). This is all the info I have. I am wondering if AXA was taken over by Goldman Sachs

Thanks

On Wed, 4 Jul 2007 09:08:27 -0500, "R. C. White" wrotf:

I have the exact question as Ira, except that I DO KNOW the circumstances of the exchange. In my case, I had a couple of funds with TIAA-CREF which were "merged" into other retail versions of the same funds. Unfortunately this merge--which TIAA says is a NON- TAXABLE event--was not on a 1-share for 1-share exchange basis, and I am now with the problem of trying to figure out how to preserve the basis cost from the "old" account in the "new" merged account.

Any ideas will be very much appreciated (I am afraid that corporate acquisition will not do the trick, will it?)

Thanks.

One more thing, the number of new shares have nothing to do with the number of old shares. So I am concerned that transforming every old transaction into a new one, as suggested by dillapides above, will result in a lot of accuracy errors. Thanks.

I think this is unlikely. I believe you need to provide concrete evidence that it is so.

I posted my question to Quicken support and they confirmed some of the suggestions posted in this forum before. For the sake of completeness and to close the discussion, here is Quicken support's response:

"I understand your concern completely and in this case you can use the transaction type as Corporate Acquisition in enter transaction field and it will competently take care of your concern. To do this appropriately just follow the step by step procedure mentioned in the link I am giving you:

Title: How do I record a corporate acquisition (stock-for-stock)? URL: