Use the Stock Dividend (noncash) dialog to record a dividend in the form of additional shares instead of cash. Unlike cash dividends (or reinvested cash dividends), most stock dividends are nontaxable. The company issuing the stock dividend will inform you whether it is taxable.
Enter a taxable stock dividend as a reinvested dividend.
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Open the account you want to use.
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Click Enter Transactions.
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In the Enter Transaction list, choose Div - Stock Dividend (noncash).
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Use this dialog to record a stock dividend you've received. Click a link below for more information. New shares issued per share: Enter the number of new shares issued per share. For example, if you receive 0.05 share per existing share, you would enter .05.
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Click Enter/New to enter another transaction, or Enter/Done to finish.
What happens in your register
After you enter the transaction, Quicken records it in your register as a Stock Split, not as a dividend. This is expected.
A stock dividend and a stock split both increase your share count using a ratio, while keeping your total cost basis unchanged. Quicken handles both the same way internally, so it uses the Stock Split transaction to record what you entered, which is what keeps your cost basis correct across the additional shares.