On 01/18/2016 05:25 PM, Jack wrote:
Two separate issues. First, I'm not sure we're using the same terminology. They pay a dividend, which needs an assigned income category, so it can be properly allocated for tax reasons. Most commonly, all of that amount is used to buy shares, so some number of shares get added to the holdings, and there is no cash to be transferred to a brokerage account.
Hello, I don't mean to hijack your thread but I have some closely related issues. First let me concur that the category amount on a reinvested dividend sould never be zero. If it was then there is no transaction to record. As Jack says it's exactly a dividend and a buy rolled into one. The dividend is income and must be accounted for as such.
I receive dividends from several mutual funds. Some are reinvested in shares of the same fund. Some are used to buy shares in a different fund from the same institution (The Vanguard Group). Some are paid as a cash transfer to my checking account (an ACH transfer). No broker is involved. There is no actual brokerage account. Vanguard does not allow cash accounts. Most of these transactions represent taxable income and need to categorized as such even though many involve no cash flow.
The only way I've found to record all these transactions in KMM is to employ a fictional brokerage account within KMM. I have to record these single transactions as two separate transactions into and out of this fictional brokerage account.
Since this fictional brokerage account does not indeed exist in the real world one would at least expect it to maintain a zero balance. Alas, due to KMM rounding errors that is not even true.
I am currently waiting to fill out my income tax returns until I receive statements (1099s) from Vanguard because the numbers I get from KMM never quite match reality.
-- Later, Jeff
