1) Go to "enter transactions" for the brokerage account where the security is held.

2) Sell the original security. The sales price is the original cost of the security.

In the memo section, describe the transaction.

3) Purchase the new security, with its new name and quantity. The purchase price is the cost of the original security.

4) When you purchase the new security, be sure to enter the acquisition date as the date the original security was purchased. (Reminder: The acquisition date is not the transaction date. The acquisition date field is located in the multiple distribution section.)

In the memo section, describe the transaction.

5) If fractional shares are involved in the merger, be sure to include the fractional shares in the purchase of the new security.

After you enter the purchase of the new security, sell the fractional share for the amount of "cash in lieu".

6) If you do not want the "sale" of the original security to be included on your "schedule d" tax report, change the tax code on the original security account.