Tim Hortons / Burger King merger

Discussion in 'Quicken' started by Art Matz, Dec 21, 2014.

  1. Art Matz

    Art Matz Guest

    Before the merger, I owned Tim Hortons stock.
    For each share I owned I got approx. $55.83 in cash and approx. 0.82 shares
    of Restaurant Brands International stock and cash in lieu of fractional
    shares.
    According to the literature I received, my capital gains will be the lesser
    of either 1) (Cash received + fair market value of shares received) minus
    my cost basis or 2) Cash received.
    In my case the total cash received is less. So, I figure all the cash needs
    to be taxed as gains and my cost basis for my Hortons stock will be my cost
    basis for the new stock.

    What would the transactions be for entering this into Quicken?
     
    Art Matz, Dec 21, 2014
    #1
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  2. Art Matz

    R. C. White Guest

    Hi, Art.

    You probably will need to wait a few days - or weeks - for an official
    explanation of the details of the merger transaction. The best place to
    look might be on the Investor Relations page of the former Burger King
    website:
    http://investor.bk.com/conteudo_en.asp?idioma=1&tipo=43682&conta=44&id=165734&storyId=72258583

    Are you a citizen/resident of Canada? Or of the USA? It probably makes a
    LOT of difference and you didn't mention it.

    I'm not familiar with this merger, but from information on the web, this
    seems to be somewhat more complex that a typical merger. A new corporation,
    Restaurant Brands International Inc. (TSX, NYSE: QSR), was created and both
    BKW and THI became subsidiaries on the new corporation. The news release
    does not say whether the transaction is taxable to either US or Canadian
    taxpayers.

    The press release does say:
    I suggest that you "stand by" and wait for advice from the lawyers and
    accountants who are being paid large fees to explain all this to
    shareholders. (I know it's frustrating; I have shares in Kimberly Clark,
    which recently spun off Halyard Holdings, Inc., and I'm still waiting for
    definitive information to file my US tax return. And Quicken 2015 does NOT
    make it easy to record this transaction.)

    RC
    -- --
    R. C. White, CPA
    San Marcos, TX
    (Retired. No longer licensed to practice public accounting.)

    Microsoft Windows MVP (2002-2010)
    (Using Quicken Deluxe 2015 R3 and Windows Live Mail in Win8.1 x64)


    "Art Matz" wrote in message

    Before the merger, I owned Tim Hortons stock.
    For each share I owned I got approx. $55.83 in cash and approx. 0.82 shares
    of Restaurant Brands International stock and cash in lieu of fractional
    shares.
    According to the literature I received, my capital gains will be the lesser
    of either 1) (Cash received + fair market value of shares received) minus
    my cost basis or 2) Cash received.
    In my case the total cash received is less. So, I figure all the cash needs
    to be taxed as gains and my cost basis for my Hortons stock will be my cost
    basis for the new stock.

    What would the transactions be for entering this into Quicken?
     
    R. C. White, Dec 21, 2014
    #2
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  3. Art Matz

    Art Matz Guest

    I'm a U.S. Citizen. Before the merger took place, I got very large book
    explaining the merger.

    There was Q&A in the book.

    Q: What are the U.S. federal income tax consequences of the transactions to
    holders of Tim Hortons common shares?

    A. (clip from the answer that relates to my situation)

    In the case of a U.S. holder of Tim Horton common shares who receives a
    combination of cash (including any cash received in lieu of a fractional
    Holdings common
    share) and Holdings common shares in the arrangement.
    (A) if the sum of such cash (including any cash received in lieu of a
    fractional Holdings common share) and the fair market value of such Holdings
    common shares is greater than such U.S. holder's adjusted tax basis in the
    Tim Hortons common shares exchanged, then such U.S. holder should recognize
    gain equal to the
    lesser of (i) the amount by which the sum of such cash and fair market value
    of such Holdings common shares
    exceeds such U.S. holder's adjusted tax basis in such U.S. holder's Tim
    Hortons common shares; and (ii) the
    cash received by such U.S. holder in the arrangement

    Since (A) was true and (ii) was the lesser. This is what I was going on at
    least unless I find out differently. If this is the case I just not sure how
    to enter it into Q.

    As you stated R.C., I usually find a document on their website how to
    distribute cost basis.
     
    Art Matz, Dec 21, 2014
    #3
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