What is the accounting treatment for dividends reinvested in a retirement account

FireFly fireflys_98 at yahoo.com
Tue Oct 19 10:26:12 EDT 2010


--- On Sun, 10/17/10, Jay Ridgley <jridgley2 at austin.rr.com> wrote:

> I get dividends that are reinvested into the stocks and
> mutual funds in my retirement accounts. These funds are not
> taxable until withdrawn. What is the proper classification
> of those moneys?

Really, depends what you WANT them to be, I have everything that is income coming from an income account, just because the tax man doesn't think it's income, doesn't mean it's not income.

However, I also segregate a number of accounts for things that aren't interesting to the tax man (like my work income that goes to my 401k) so you can do something like that. Bearing in mind I produce NO tax documents from GNUCash, so that may have some bearing on this.

> One side must be the account for the stock/mutual fund
> involved (I think) but what should about the other side?

As a warning, if you are using income accounts to directly buy stocks, it will screw up the account portfolio report, this doesn't (apparently) expect you to buy stock straight from income, it instead expects the money to go into a "cash" account first, and then be used to buy the stock, just a friendly tip.

- James Duerr

E-mail: FireFlys_98 at yahoo.com
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Discover a lost art - play Marbles. May 2004
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