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Return of Capital and No effect on Cost Basis?

Questions on using, creating, or understanding data in Fund Manager reports.

Postby heidiasst » Wed May 04, 2022 8:12 am

Good Morning Mark,

MPW is breaking down its dividend and part of it is "Return of Capital"

I updated the dividends to reflect the "Return of Capital" portion.

It is not reducing the Cost Basis in FM, shouldn't it do that?

Help,
Heidi
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Postby Mark » Wed May 04, 2022 8:37 am

Hi Heidi,

Yes, a "Return of Capital" type distribution will lower your tax basis. How exactly are you looking at the after distribution tax basis?
Thanks,
Mark
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Postby heidiasst » Wed May 04, 2022 10:21 am

The price of the investment hasn't changed on any of the reports we run

Is this something I would do manually?

We are still holding the stock
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Postby Mark » Wed May 04, 2022 10:36 am

Hi Heidi,

Which price exactly? A market price? A change to your tax basis, won't adjust the market price.
Thanks,
Mark
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Postby heidiasst » Wed May 04, 2022 11:32 am

The stock prices in the portfolio report are still showing the original cost basis from when we purchased the stock
heidiasst
 
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Postby Mark » Wed May 04, 2022 11:51 am

Which exact report and prices are you looking at? A Custom report? A Portfolio Value report? If so, what fields are you looking at? The only prices that would change are tax basis/share prices. If you can let me know exactly what you're looking at, I can be more specific.
Thanks,
Mark
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Postby heidiasst » Wed May 04, 2022 11:57 am

This is on the Portfolio Value Report
heidiasst
 
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Postby Mark » Wed May 04, 2022 12:05 pm

The Portfolio Value report shows a market price as of the report's date. This is different from your tax cost basis. The market price is how much they are worth on that date, and the tax basis price is how much you paid and is used when calculating your capital gains.

You can see all your market pricing data in the Data Register under the "Prices" data type. Recording a Return of Capital distribution will have no impact on these prices.

If you want to see your tax cost basis numbers, you can run a Custom report with fields like:

Tax basis per share, Assigned Method
Tax basis, Assigned Method

These are your tax basis figures for the currently owned shares, and will reflect any Return of Capital distributions you have recorded.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
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Posts: 10527
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Postby heidiasst » Wed May 04, 2022 12:25 pm

Our Portfolio Value Report must be customized because we wanted it to show our actual cost basis on the report rather than the current market price.

I was under the impression that when I posted the return of Capital that the report would change to reflect that in our Cost Basis
heidiasst
 
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Postby Mark » Wed May 04, 2022 12:27 pm

You can't customize a Portfolio Value report. Maybe you're really using a Custom report? From within your report, look at "Edit / Report Settings...". What is the "Type" set to? If you are using a Custom report, click on the "Custom Settings..." button and tell me the name of the field you're looking at that you expected to change.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
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Posts: 10527
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Postby heidiasst » Thu May 05, 2022 7:43 am

The Report Type is: Portfolio Value

The "End NAV" is where our current price is for our holdings, this is where I expected to see the price drop due to the return of capital
heidiasst
 
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Postby Mark » Thu May 05, 2022 7:55 am

Hi heidiasst,

The "End NAV" is the market price on the ending report date. The market price is different than your tax basis price. One is what it is valued at on the open market, the other is how much you paid. Recording a RofC distribution will not change any of the market prices, it only changes your tax basis.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
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Posts: 10527
Joined: Thu Oct 25, 2007 2:24 pm
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