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Hi Rachel,
I am not familiar with a capital infusion that is not accounted for by the parent as an additional investment in the subsidiary or a loan to the subsidiary. I am a little confused on the accounting entry the parent company made related to the capital infusion. It sounds like you increased the value of your investment by the capital infusion but did not recognize an additional purchase of stock which would be detailed on Schedule D part 3, so the additional investment is falling out of unrealized gains. Recording an unrealized gain is not typical treatment of a capital infusion but not being familiar the details of this transaction, you may want to confirm your treatment with your outside auditors or your state regulator.
Regards,
Lisa Mullen
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