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Analyze (Reconcile)

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Brokerage Import >> Analyze (Reconcile) >> Report >> Export to Tax Software

I. Select a Date Range

Start by selecting a tax year of interest. If you don't see the current year in your menu or if it is grey then you might need to renew the license. Visit the home page and select buy or similar pricing/purchase guidance.

Otherwise, use the following filter...

  • Date Range Type: Year & Tax Period
  • Year: The current tax year
  • Period: All
II. Reconciliation Summary
  1. Select Reconcile Gain/Loss

  1. The following summary appears.

If your data does not contain options then you can skip to the Reconciliation Wizard instructions further down the page. Otherwise it is best to review the section on closing options first.

After importing or adding data to TA it is helpful to get an overview of reconciliation work required. TA provides views and tools custom designed to reconcile transaction data. View this dialog for an overview.

Notice the Show Details hyperlinks on the right side of the screen. Select a link to see the screen view. TA will adjust the filters to create the view. Also notice the Need Help with reconciliation link at the bottom of the page. This connects to a web page with additional information.

III. Reconciliation using the Wizard

You can likely fix all of your none options trades using this tool. Then use one of the tools (see below) to finish closing option trade. After that step you can go into greater details by selecting the Reconcile Gain/Loss wizard. This allows you to steps through and review your trades against a 1099.

Keep in mind that 1099 can contain errors so a first step is confirming that you agree with the your 1099. This is why it is important to keep track of your trades during the year.

  1. Select Screen = Transactions
  2. Select Display View = Positions - Reconciliation

Here is the big picture. When you import trades they appear in the Transactions screen if they are in TA and not excluded by a filter setting like a date range or a symbol type. This means you should see all trades in the Transactions screen.

However, only grouped trades appear in the tax report. A group consists of an opening and a closing trade where the date of the opening trade is before the data of the closing trade. Because imported data can have errors like missing time of day or incorrect closing action (Buy vs. Buy to Cover) TA is custom designed to fix these cases.

TA Version 3.7 includes a reconciliation wizard in the Transactions screen so you can interact with your data and see what needs attention. We recommend using the wizard to get trades to groups. Here is it works.

  1. Scroll through your trades while watching the Alert column.
  2. If you see a message in the Alert column then focus the mouse on the message.
  3. Select Right-Mouse to show a menu of choices.
  4. Make a selection and notice how the transaction is modified.

The message is a suggestion of how to fix the trade. After clicking on a few you should have enough experience to fix most of the trades except for the options as mentioned above.

TA also provides a Groups Screen with list views of trades that are not grouped. In addition the Groups screen include a tool (see Display View: Manual Groups) that allows you to manually group select trades.

IV. Close Options (hundreds at a time)
  1. Select Tools/Options - Automatic Exercise/Assign

  1. Select Find to choose an account
  2. A dialog similar to the following appears.
  3. Use the check boxes to decide how to close the options (Exercise, Assign, Exp).
  4. If the Expiration dates are correct (see the Required Options Information below) then the dialog will show the correct Exercise and Assign/Expiration dates. In some cases you can edit the date in this view. If numerous options require date correction then use File/Export/Symbol Details, create a file, edit the file then use File/Import/Symbols Details to file the dates.
  5. When satisfied with your selection, select Update.

If you have opening option trades (Buy Call or Put, Sell Call or Put to Open etc) and the data in TA does not have closing trades, use TA to close the trades manually (one at a time) or automatically (a list at a time).

Use the Reconciliation Summary view to determine if there are Reminder transactions for options. If yes then deleted them using the Transactions screen. In the Transactions screen you can select several trades by clicking on a trade then using shift then click or CTRL then click to select more trades. Then select the delete button.

Then use Tools/Options - Automatic... to close a list of options. This tool finds option trades that are note grouped and lists them in a dialog for you to take further action like Exercise, Assign or Expire. Just make sure the dates in the symbol table are correct. If you need to update the dates you can edit symbols details in two ways. 1) Edit/Symbol(s) - Add/Modify or 2) File/Export/Symbol Details, edit using NotePad or a spreadsheet software then File/Import/Symbol Details.

Here is a 1 min. video regarding options - Show Video

V. Close Option Manually

After removing Reminders as mentioned above, use the following tools to manually close options.

  1. Select Tools/Options - Manual Exercise/Assign

  1. A dialog similar to the following appears

  1. This dialog allows you to apply a basis adjustment to an opening trade but requires location of the trade generated by the Exercise or Assignment of the option. This method take more time so most people use the automatic solution to close the options at $0.00 and immediately recognize the premium as a gain loss vs. this method which defers the gain/loss.
VI. Reconciliation using Groups Screen - Missing Opening Trades

Here is an video that shows how to use the filters and determine why a trade is not grouped - Show Video

  1. Within the reconciliation summary dialog select Show Details
  2. Or select a filter manually

  3. Screen: Groups
    Display Mode: All Symbols
    Display View: Not Grouped - ...

Comment:

TAPro matches trades into groups using FIFO or manual match. If trades are missing or incorrect then they are omitted from the Tax Reports and appear as ungrouped.

Trades are ungrouped because they are imported with incorrect times (for example the close date/time before open date/time), incorrect actions (like Sell vs. Short Sell) or they are missing. Use TAPro to edit any trade or add missing trades (Edit/Transaction(s) - Add/Modify...)

Each time a trade is added or modified TAPro recalculates the groups and Tax Reports. See the Match/Group rules at the end of this section for details.

  1. Let's assume you see the following

  1. Trades 1 and 2 are Closing trades with missing Opening trades.
  2. To confirm our assumption use the Transactions Screen....

  3. Screen: Transactions
    Display Mode: By Symbols...
    Display View: Positions - All (CA's by date)
  4. This view is from a version of TA prior to 3.7. The new view is improved.
  5. You can fix trades by selecting modify or use the Reconciliation wizard mentioned above.

Comment:

It appears the Buys are missing. You can add them manually. Use Edit/Transaction(s) - Add/Modify...

VII. Reconciliation using Groups Screen - Missing Closing Trades
  1. Assuming you see the following...

  1. Trades 4 and 5 are Opening trades with missing Closing trades.
  2. To confirm our assumption use the Transactions Screen....

    Screen: Transactions
    Display Mode:By Symbols...
    Display View:Positions - All (CA's by date)

  3. This view is from a version of TA prior to 3.7. The new view is improved.
  4. You can fix trades by selecting modify or use the Reconciliation wizard mentioned above.

Comment:

It appears there are no Closing trades for the options. Also notice there is a Journal Out Closing trade which brokers use to indicate an Exercise, Assign or Expire event that is not applied. Review options instructions details for details regarding closing options in bulk (many at one time).

VIII. Removing Reminder Transactions

Reminder transactions are created during Sync import when there is not enough information for TAPro to automatically generate correct closing trades for options. Here is a 1 min. video of how to manually deleted Reminders - Show Video

  1. Find all Journal Out Reminder Transactions
  2. Select Show Details from the reconcile gain/loss dialog next to Reminder Transactions or use the following filter....
    Screen: Transactions
    Display Mode: All Symbols...
    Display View: Reminders

  1. Select and delete one at a time or select the first one, scroll to the end and use shift click to select the entire list. Then select Delete.

Comment:

We recommend using Expire for all options because the math result is the same assuming you have the additional trades associated with an Exercise (contracted Buy) or an Assign (contracted Sell).

IX. Required Option Information

TAPro Option tools reference Symbol information. If Sync import is used this information is provided. If manual import is used then add the missing information manually. The Assign/Exp date used by TAPro to Expire options comes from the data found in Edit/Symbol(s) - Add/Modify. If an options symbol is recycled each year the data might have the date associated with the current year vs. the correct date, check this by looking at symbol details.

Here is a 1 min. video of how to correct an Expiration date or edit symbols - Show Video

X. FIFO Trade Matching/Groups Rules

Grouped trades (tax lots) conforming with these rules will appear in TAPro Tax Reports.

General Rules:

  • Opening and Closing Trades are the Same Display Symbol
  • Opening and Closing Trades are in the Same Account
  • For each Closing Trade, an Opening Quantity is available that is not grouped
  • The Date and Time of the Opening trade <= the Date and Time of the Closing trade
  • The Tax Calendar has not expired.
    Note: If the Tax Calendar has expired then tax lots after the expiration date will not appear.  In this case update TAPro with a new license key.

Rules for Actions:

  • Buy groups with Sell
  • Sell to Open groups with Buy to Cover
  • Buy to Open groups with Sell to Close
  • Short Sell to Open groups with Buy to Close
  • Buy to Open Call groups with Sell to Close, Exercise or Expire
  • Sell to Open Call groups with Buy to Close, Assign or Expire
  • Buy to Open Put groups with Sell to Close, Exercise or Expire
  • Sell to Open Put groups with Buy to Close, Assign or Expire

Additional Rules for Options:

  • To Exercise an Option, must be a Call and the Exercise Date < Assign/Exp Date
  • To Assign an Option, must be a Put and the Assign Date = Assign/Exp Date
  • To Expire an Option, The Expiration Date = Assign/Exp Date
XI. Summary

You can also save a copy of the data, experiment then restore the saved version.  TAPro is flexible.  You can enter trades in any order and you can apply views and sorts without changing the data.  You can edit any trade from the Transaction Screen.

To resolve not grouped trades try one of the following:

  1. If there is a missing opening trade, find the missing trade by looking at your statement or on-line account and manually added it.
  2. If there is a Sell before a Buy there may be an undiscovered Short Sell. Use Tools/Long/Short Sell Discovery to fix this. Or manually change the Action of the trades from the Transaction Screen by using Modify.
  3. If you trade options you may find that closing trades are missing. This is because the file didn't contain an Exercise, Assign or Expire trade to close the options. Visit Tools/Options for a list of tools to help with this either one at a time or in bulk.

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