[GNC] Transferring mutual funds

Thu Jul 6 17:15:32 EDT 2023

I just took a look at the Advanced Portfolio report to see what GC 
thought about what I had done. It does appear that the basis was lost as 
part of the transfer because for each of the funds that transferred over 
the new basis is exactly the value at the time of the transfer instead 
of the original basis.

I'll try on a copy of my file just moving the investments over to see 
how the report behaves. I don't actually use this report (in fact this 
is the first time I've opened it).

I took a look at the tutorials but there isn't anything that covers 
outright transfer of a fund nor is there anything about how to update 
the basis costs and dates (or where the Advanced Portfolio report looks 
to get its basis data).

I'd like to understand the mechanism that I'd need to use for Gnucash to 
actually accomplish this type of transaction as an academic exercise. 
I'm not affected by the errors because anything having to do with taxes 
will use the original source materials/statements instead of a Gnucash 
report. It would be a useful piece of knowledge to also avoid painting 
myself into a corner where Gnucash actually breaks in some way because 
of conflicting entries. Plus, since the transfers occurred only this 
month there's very little data that I have to replace in order to make 
changes.

On 2023-07-06 08:40, David T. via gnucash-user wrote:
> Kalpesh,
> 
> Your assessment regarding capital gains rates is accurate; it's been one of my problems with this issue for some time. It also comes up with stock splits, where the "new" shares should have the original acquisition date. Honestly, this is not an easy issue to finesse without a boatload of work.
> 
> For what it's worth (most likely not a lot), when I had a brokerage change many years back, I created a new account in GnuCash for that brokerage, and simply moved the stock accounts into that new brokerage account. It probably violates 17 rules of accounting, but it worked for me.
> 
> ⁣David T. 
> 
> On Jul 6, 2023, 3:39 PM, at 3:39 PM, Kalpesh Patel <kalpesh.patel at usa.net> wrote:
>> Hmmm. So I am a bit perplexed here.
>>
>> Disclaimer: I am a new-bee when it comes minutiae's of the investment
>> transactions so I might be wrong what I am about to state. Feel free to
>> correct me.
>>
>> If you note such factitious sale or closing of the transaction to
>> preserve the cost basis as you mentioned, are you not altering how long
>> the security is held which will impact capital gains reporting? If you
>> alter in such a way, I am not sure if that is same thing as
>> transferring the security to another account, at least not the way
>> brokerages do so in the US amongst them or within them.
>>
>> Would you not want to simply move the original buy/sell transaction by
>> re-pointing one of the split line item from the old account to new one?
>> This I would think keeps the entire transaction intact as-is which what
>> the transfer should be about and then you can have a zero valued
>> transaction on the date of the transfer itself which would have no
>> impact on any reporting.
>>
>>
>> -----Original Message-----
>> From: David Carlson <david.carlson.417 at gmail.com>
>> Sent: Wednesday, July 05, 2023 1:08 PM
>> To: Fred at mandfb.me.uk
>> Cc: AC <gnucash at acarver.net>; gnucash-user at gnucash.org
>> Subject: Re: [GNC] Transferring mutual funds
>>
>> AC,
>>
>> Fred implied, but didn't elaborate on the point that the shares in the
>> original brokerage account had a cost basis that was incurred when they
>> were purchased.  When you transfer them out, that is equivalent to a
>> sale or closing transaction, and the cost basis should be adjusted
>> accordingly, even though there were no funds involved.  Of course, that
>> exact cost basis needs to be added to the receiving account as if the
>> shares were purchased at the original price.  This used to be described
>> in great detail in one of the help manuals, including the somewhat
>> tricky procedure to enter realized gains when an actual sale happens
>> but I haven't checked lately to see if those parts are still there.  I
>> know that if you do not do those things and later run a trial balance
>> or if you use the Investment Portfolio report, you will quickly see the
>> error of your ways.
>>
>>
>>
>> On Wed, Jul 5, 2023 at 11:33 AM Fred Bone <Fred at mandfb.me.uk> wrote:
>>
>>> On 04 July 2023 at 16:29, AC said:
>>>
>>>> I recently moved some mutual funds from one brokerage to another.
>>>> The process did not involve a sale, it was just a transfer of
>>>> control from
>>> the
>>>> old to the new.
>>>>
>>>> In my current books I keep mutual funds listed as subaccount under
>>>> each brokerage as such with their respective security/currency:
>>>>
>>>> Investments
>>>> -Brokerage 1 (currency)
>>>> --Fund A (security A)
>>>> --Fund B (security B)
>>>> -Brokerage 2 (currency)
>>>> --Fund A (security A)
>>>> --Fund C (security C)
>>>> --Fund D (security D)
>>>>
>>>> I wanted to expand this to add the new brokerage and then perform a
>>
>>>> transfer of the funds from one to the other. Let's assume I moved
>>>> the funds under Brokerage 1 to Brokerage 3. So the tree would look
>>>> like the simplified version below (leaving out Brokerage 2 as it is
>> unaffected):
>>>>
>>>> Investments
>>>> -Brokerage 1 (currency)
>>>> --Fund A (security A)
>>>> --Fund B (security B)
>>>> -Brokerage 3 (currency)
>>>> --Fund A (security A)
>>>> --Fund B (security B)
>>>>
>>>> The securities are the same because it's the same original mutual
>>>> funds, just moved to another brokerage. The tree would be left
>>>> intact with the funds under Brokerage 1 being zeroed out and the
>>>> funds under Brokerage 3 starting off with the incoming values.
>>>>
>>>> My natural tendency was to create a transfer directly within
>>>> Brokerage 1 Fund A that moved all the shares over to Brokerage 3
>>>> Fund A but that didn't create the transaction I expected.
>>>>
>>>> By example, I transferred Fund A on July 1 which contained 10
>> shares
>>>> at the price of the shares on that day. So in Brokerage 1 I entered
>>
>>>> -10 shares with a total sell price of X as listed on the statement
>>>> from Brokerage 1. The price is autocalculated and the balance
>>>> correctly goes
>>> to
>>>> zero.
>>>>
>>>> Looking inside the Brokerage 3 Fund A account I only see a
>>>> transaction that has an amount in the buy column but no shares and
>> a balance of zero.
>>>> I can manually enter the same number of shares in that partially
>>>> empty transaction but why was my thought about the transfer
>>>> incorrect? Should
>>> it
>>>> have not transferred those shares over as well?
>>>
>>> Did you work in split view?
>>>
>>> I can replicate what I think you are saying if I don't enter the
>>> separate splits.
>>>
>>> If I go about it the obvious way (in split view) and enter balancing
>>> amounts then it all works.
>>>
>>> However, I'm still on 2.6.21 ...
>>>
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>>
>>
>> --
>> David Carlson
>>
>>
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