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Cash transfer between IRA accounts treated as contribution

Unknown
Unknown Member
edited October 2018 in Investing (Windows)
I moved my IRA from one brokerage to another. In both Quicken Premier 2015 (transactions I entered last year) and 2018 (transaction I entered today) the funds moved fine but the cash was categorized as a "contribution." I see old threads from earlier Quicken years reporting this same problem. Why has Quicken not been fixed to recognize that a transfer between 2 IRA accounts is not a contribution?

Comments

  • Unknown
    Unknown Member
    edited February 2018
    i just did two of these, within same fund family, and same problem. Not only did transfer not properly move the funds, but was recorded as an Ira contribution. 
  • This is a chronic problem and one that continues from year to year with no corrective action to create a fix, ever.  IRA's are a very important part of individuals and families financial health.  It would seem that Quicken could easily fix this for their customers.  We do transfer money within IRA's as CD's and Mutual Funds and sometimes transfer an IRA to another bank, etc.  Every time Quicken asks for the contribution year...  but the contribution could have been made in the past.  See the problem!
  • NotACPA
    NotACPA SuperUser, Windows Beta Beta
    In both cases, it's shown as Income because you set the Tax Attributes of the account(s) to show "Transfers Out" as taxable income:

    You can either turn that off, OR, my preferred action, is to simply change the "setup options" of the account to reflect the new IRA Trustee.
    Also, why are there multiple IRA accounts ... instead of holding multiple securities within a single IRA account?
    Q user since DOS version 5
    Now running Quicken Windows Subscription,  Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP
  • mshiggins
    mshiggins SuperUser ✭✭✭✭✭
    From C. D. Bales:
    Based on the original post in this discussion; the basic issue in this discussion is that: while securities are transferred correctly, Cash transferred between IRA accounts gets treated as a Contribution in the TO IRA account.

    The workaround for this issue has been posted here quite a few times in the past. 

    [And a workaround is likely all you can get from this Community as no one here knows "why" Quicken still has this problem.]

    The key to the workaround is to insure that everything you transfer between IRA accounts is a "security".

    You can create a dummy security (type Mutual Fund would be good) using any security name you like ... call it "Dummy Cash" or "Cash Security", or whatever. Treat it as having shares that are always priced at $1/share (like a Money Market fund).

    When you need to transfer cash from one IRA to another:
    - Use all the cash in the FROM IRA account to purchase shares of "Dummy Cash" (at $1/share)
    - Use "Shares Transferred Between Accounts" to transfer all shares of "Dummy Cash" to the TO IRA account
    - Sell all shares of Dummy Cash in the TO IRA account (at $1/share)

    Quicken user since Q1999. Currently using QW2017.
    Questions? Check out the  Quicken Windows FAQ list
  • These workarounds or manipulations are like bandaids when in reality, all you really have is a scratch that itches.  It would seem a very simple fix to just add a few other choices to the dropdown list creating additional option choices, such as... Is this a new contribution, an RMD, or transfer within your IRA fund?

    As for the question from the Super User... "Why are there multiple IRA accounts ... instead of holding multiple securities within a single IRA account?  ...We want to utilize firms like Schwab, local credit unions, etc, and maximize our savings, with insurance when available, and utilize their many advantages.  We both have traditional and Roth IRA's.  We also like the ability to keep those funds separated into individual accounts on Quicken and download the transactions when possible.

    Quicken is a great program... but this issue should have been fixed years ago. Nobody desires workarounds, do they??
  • Jim_Harman
    Jim_Harman SuperUser ✭✭✭✭✭
    Another issue that adds complexity to this situation is that a distribution from a tax deferred account might or might not be taxable - it might be a regular distribution, a rollover to another IRA or a Roth conversion. And from Roth accounts, some distributions are taxable and some are not, depending on your age.

    And a deposit to one of these accounts might be a contribution, a rollover, or a conversion.

    Like many tax related transactions (qualified dividends come to mind) these situations are best handled in tax software like TurboTax IMO.


    QWin Premier subscription
This discussion has been closed.