In microsoft.public.money, jch wrote:

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I agree you paid $5000. Does the IRS allow you to add that $10 back
onto to your basis for the remaining 499 shares, as you assume, or
does the IRS say that that $10 is a miscellaneous investment
expense? That is *my* question.

I expect you to get a 1099 for selling that $10 share. I expect you
to put an acquisition cost on those share on your schedule D, that
would be reducing your remaining basis.



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That is your question, as I understand it. Money does not support
that in a direct way, as far as I know.


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Thanks Cal.

I just want to make sure we are talking about the same situation. I buy 500
shares of Investment X at $10 each, but a year later one share is sold as an
administrative fee. So I own 499 shares, and my cost basis (the amount I
paid) is $5000.

When I remove the share, I am trying to not reduce the original basis
($5000), which I thought was a proper thing to do by tax law. That way, the
cost basis represents the total amount of money I have contributed for the
investment. Assuming this is appropriate, is there any combination of
transactions that can accurately reflect this in MS Money?

-Chris

"Cal Learner-- MVP" wrote:

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In microsoft.public.money, jch wrote:

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When you sell shares, the basis of the remaining shares is
unaffected.


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If you remove the shares, what are you trying to not reduce the
basis of?

I think you are trying to add the original basis of the shares that
were sold to the unsold shares. I would be interested in a reference
that says that is a proper thing to do by tax law. I am not saying
it is not permitted and appropriate. I actually would like to know
that is the right thing to do. I seem to remember reading something
along those lines, but I could not find it when I searched.

If it is appropriate, it would be nice if Money would increase the
basis of the associated shares with an OtherExpense transactions. It
doesn't.



T


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When I enter the Sell transaction, the value of the shares deducted for the
investment fee apparently lowers the Cost basis. I thought the Cost basis
was supposed to be the total amount paid for the investment, including
commissions and fees. How do I remove the shares without lowering the Cost
basis?

"Cal Learner-- MVP" wrote:

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This:
"Do a Sell of ABCDX for $10 total with no commission.
Do an OtherExpense transaction of ABCDX for $10 total."
Worked just fine.
What was confusing me was how to allocate the $ from the sale. I kept
wanting to do a "transfer to:" a cash account associated with that fund and
then charge the expense back against it with out having to create expense
accounts for each fund.
By just leaving the field blank it would appear that this happens with in
the account anyway.

That being said, your statement of "Perhaps you are suggesting a combination
transaction as ReinvestDividend is equivalent to a Dividend and a Buy."

Is exactly what I am suggesting. I dont care if it records it as two
transactions or accounts it as such, just that the function from a UI
standpoint matches what the fund statements are indicating:
Anual fee $10 -.xxx shares at $xx.xx price and -$10

In microsoft.public.money, wchp wrote:

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Do a Sell of ABCDX for $10 total with no commission.

Do an OtherExpense transaction of ABCDX for $10 total.

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I this will make the performance analysis of indicate a lower ABCDX
performance than it would have had.

I believe that this will cause your schedule D to show a $10 sell
with an acquisition cost dependent on your basis. I believe that is
what US law calls for. I think that the transaction will be reported
by your mutual fund on 1099-B.


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I don't know what you are suggesting. Perhaps you are suggesting a
combination transaction as ReinvestDividend is equivalent to a
Dividend and a Buy. I guess that could be useful to have, but I
think that if you download, it would come down as two transactions
anyway. I don't think there is a transaction like that described in
the OFX specifications.

You are indeed doing a sell that should show up on your schedule D
if the account is taxable (and you are in the US). If you are
talking about a tax-deferred account, the same method would be best,
I think. However there there is no tax reporting consequence.

Cal,
I am not sure what you mean by "Do a Sell of the number of shares deducted
for the investment fee.
Do another transaction. If the expense is associated with a single fund,
you can do an OtherExpense transaction in the Investment Transactions
register."

Would you be willing to do a how to, step by step?

Fred's responce below would address what I am looking to see, and that is
the fee cost going against earnings, but this then creates another issue.
Does the way you are sugesting to do this show up as reduction in earnings
and propperly account for those fees for IRS purposes?

Need to get a sugestion in to the Money folks to add a "Fee" transaction
type that allows for the entry of negative shares.

"Cal Learner-- MVP" wrote:

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Thanks for the tip and the link, Cal. I'd better clean up my handling of
fees. Hmmm, I hope the I*R*S auditors aren't monitoring this thread. ;-)

"Cal Learner-- MVP" <via_newsgroup[at]please.tnx> wrote in message
news:50kdu01lo6kelar039kb6mbb0tgd8l99ug[at]4ax.com...
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In microsoft.public.money, "Fred Todt" <ftodt AT yahoo DOT comwrote:

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It is not according to law in the US. In the US, the sale should be
reported as a sale. The fee should be a miscellaneous deduction and
therefore subject to a 2% threshold, and even then, only usable if
you itemize.

http://www.irs.gov/publications/p529/ar02.html#d0e1501

Doesn't seem fair, does it?

Here's how I do it with Money 2003 Deluxe:

Enter a sell transaction, and put the $ amt of the sale in the Commission
field, leaving the Total field blank, so the net $ effect of the transaction
is $0.

Is this bad accounting practice? Will it come back to haunt me when I try
to sell shares and/or compute capital gains? Does it mess up investment
performance calculations?

TIA,
Fred

"Cal Learner-- MVP" <via_newsgroup[at]please.tnx> wrote in message
newsn79u0pjedomsodqnrg38p9k0qindlgsoa[at]4ax.com...
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In microsoft.public.money, wchp wrote:

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Do a Sell of the number of shares deducted for the investment fee.
Do another transaction. If the expense is associated with a single
fund, you can do an OtherExpense transaction in the Investment
Transactions register.

Alternatively, do an expense transaction from the account that the
money goes to when you do a Sell.


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In microsoft.public.money, wchp wrote:

- quote -

Do a Sell of the number of shares deducted for the investment fee.
Do another transaction. If the expense is associated with a single
fund, you can do an OtherExpense transaction in the Investment
Transactions register.

Alternatively, do an expense transaction from the account that the
money goes to when you do a Sell.


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My funds are set up to auto re-invest all dividends, L, M, and S term cap
gains and all fees are to be paid from the respective fund/account.
This is listed as a negative transaction on the statements and reflects a
negative adjustment to my share holdings.
NOW how the heck do I enter a negative share transaction??
Money will not let me.
I dont want to "sell" them and transfer the money to an account as there is
not an account and it is always 0$
I am not able to find this in help, manual, google or here in the forums.
Any thoughts would be helpful