Is there a better way to get a partial surrender of an annuity into the income category of my report

jomac Member ✭✭
edited May 2018 in Investing (Windows)
I have been trying to get the gross proceeds of a partial annuity surrender into the Income section of my Itemized Categories report.  And yes the gross proceeds are reported as income, which is why tax on the gross amount was withheld.  Has to do with the LIFO aspect of some annuities where withdrawals are against the earnings of the annuity first, which is taxable.  (e.g. initially invested $10,000 and held on to the annuity for some time and the current value is $15,000.  If I surrender $5,000, this goes against the $5,000 earnings, which are taxed as ordinary dividend.  When I hit the original investment, it's tax free.)

The annuity is made up of multiple securities and the transaction confirmation showed a list of securities, number of shares surrendered, the price per share and the amount.  To show the reduction in the security, I recorded them as a sale.  On the Tax Schedule section of the account, I indicated Transfer Out:  1099-R: Total IRA taxable distribution.  Using the Cash Transferred out of the Account transaction, I moved the proceeds from the annuity to the checking account which actually got the funds.  But only the realized gains showed, not the income.  So I deleted realized gains.  To get the gross proceeds into the Income Section of the Report, I edited the transaction using the Income category and put the gross proceeds amount into the miscellaneous section.  That requires a category and I used Pensions Ann, so the $5.000 (per my example) is finally reflected as income.

There's got to be an easier way to handle this.  I've got Q2015 Deluxe-Windows.  Please, is there an easier, less convoluted method to get the gross proceeds into Income?


  • Unknown
    Unknown Member
    edited February 2017
    Pretty sure Quicken shows income as FIFO, not LIFO...and there is no setting to distinguish the two...unless you set up your annuity as separate lots and then specifically tell Quicken in your investment register transaction which lots you want to sell per transaction.

    Other than that, I think you're doing it right, as convoluted as it seems.  
  • q_lurker
    q_lurker SuperUser ✭✭✭✭✭
    edited May 2018
    Did you follow and understand this discussion asking the same question?

    That seems to indicate your issue is in the customization of your itemized category report.  The report should be set up to exclude the annuity account from the report.  Then the transfer into the cash accounts will show as an income line item.  That is likely the best you can do.  I do not see a way to have the first $5K removed as taxable and the $410K balance removed as tax exempt. 

    I believe the "Transfer Out:  1099-R: Total IRA taxable distribution" setting is only going to relate to tax reports, not itemized category reports, since you are thereby only assigning a tax line to the transactions.  
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