Write off part of a share equity purchase cost RRS feed

  • Question

  • Hi

    I have a share investment in Money Plus Deluxe. The share price has dropped substantially and is unlikely to recover. How can I write the cost value down to a current realistic market value please?

    Tuesday, May 7, 2013 8:24 PM

All replies

  • Put in a price quote. That is the normal way to update the value of a security. This can be done manually.

    Go to Investment->Portfolio and right-click the securiyt. Choose
    SeeInvestmentDetails. Then choose

    Price quote entry can be automated. That is one of the things that PocketSense can do.

    hleOFXquotes can do that too.

    Tuesday, May 7, 2013 11:25 PM
  • You probably just wanted to have your financial statements reflect realistic market values, and, if so, this comment does not apply to you.

    You mentioned purchase cost value, and not market value. As a matter of accounting, you cannot "write down" the purchase cost. It will always be true that you paid some amount for some shares at some time regardless of what you do. The only time the purchase cost "goes away" is when the underlying security is sold or becomes worthless. Then you will "realize" a capitol loss, which removes the purchase cost.

    Changing the price quote changes the market value, but leaves the purchase cost (your "basis") alone. This is important in tracking your net worth, but it is not a "write down" for tax purposes, since the loss on the security is not "realized" until you sell it. To realize your loss, you have to sell the security. Then you will have a capital loss, which comes in handy at tax time to offset your capital gains and ordinary income. Even so, this would not write down the purchase cost.

    Friday, May 10, 2013 8:07 PM