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IRA distribution doesn't show as income in the tax summary report or cash flow report

unknown

I'm using Windows 2016 Home & Business.
There are several posts regarding this issue, but none I've found answer the question. Since an IRA distribution from a tax deferred account is claimed as income it only makes sense that it would show in the inflow/income column of any report. I've tried specifying the IRA related categories in Quicken, but when I do that I'm asked, "record this transaction as an income category". If I click yes the transaction shows as a negative in the inflow/income report. It should show as a positive number. The only other option in the dialog box is cancel. The only way I've found to show the IRA distribution as income is to include transfers in the report. When I include transfers all transfers show up, which completely skews the income amount.

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Quicken_Tyka

Hey Sandy,

Sorry you're experiencing this difficulty.

Can you upload a screenshot of the amount reflecting negatively?

To capture an image you can use the snipping tool.

For more instructions on issuing the snipping tool, please see https://support.microsoft.com/en-us/help/13776/windows-use-snipping-tool-to-capture-screenshots.

-Quicken Tyka

mshiggins

You can select the transfer account in the report Customize dialog for Categories. Just look for the transfer account name enclosed in square brackets, like [account], and select that "category".

unknown

Here's the "show as income dialog" & the report with the negative amount.

Quicken_Tyka

Thank you for providing that Sandy,

What other options are available under the 'Enter Transaction' menu?

The amount is negative because it's a withdrawal from the account.

-Quicken Tyka

unknown

Other options are:
*other cash transactions
*withdraw
*deposit
*reminder transaction
*cash transferred into account
*cash transferred out of account

mshiggins

From C. D. Bales:

IRA distributions - from certain IRA type accounts, such as Traditional IRAs - are only income for tax purposes. The "income" (as in "earned income") was income back in the year you earned it, and likely contributed a portion of it to your IRA. Treating distribution of funds from such IRA accounts as "earned income" would be double-counting your income.

In Quicken: IRA distributions are "transfers" out of the IRA account. Quicken provides a simple mechanism to address that: see the "Tax Schedule" button in the Account Details dialog of the IRA account. The "Transfers Out" box should probably say: "1099-R Total IRA gross distrib".

Transfers out of any Quicken accounts will appear in your Quicken reports, if you elect to "Include All" transfers in the report (on the Customize > Advanced tab)

unknown

That isn't quite true. In my case I contributed to a 401K, which was pre-tax. I believe a traditional IRA is treated the same. And when the money is withdrawn it is treated as Income and is fully taxable. In my case I transferred the 401K to a traditional IRA. With Quicken 2016 I see that it is not treating the IRA withdrawals as income and instead is trying to make them look like a capital gains type transaction.

unknown

For the IRA account, EDIT the Account Details and click on Tax Schedule. Make sure you have the settings as follows, especially for the Transfers out:

Then, when you make the IRA withdrawal to cash, DO NOT USE THE SELLX transaction type. You will need to use two separate transactions:

1 Sell the shares/units of the security to create a cash balance.

2 Use Cash Transferred Out of Account to transfer the cash to your banking account, presumably your checking account.

If you use SELLX, the transfer will NOT be recorded as income.

If you have taxes withheld from the IRA distribution, add split lines in the checking account deposit to reflect the appropriate deductions from the distribution.

For example, you have a $50,000 IRA distribution, you'd sell shares of your securities to equal $50,000 in a cash balance.

You'd then use a Cash Transferred Out of Account in the amount of $50,000 FROM that IRA investment account TO your checking account.

In your checking account, you'd have the transfer split lines of:

1 [IRA account] $50,000.00
2 IRA Fed With -$5,000.00

Total transaction shown in the checking account = $45,000.00

unknown

I don't see a way to create a "cash holding" for the investment account. In Deluxe you have "SoldX Shares sold and funds transferred". In the account settings I see no button/option to set up a "cash holding" for the account. So I have an asset transfer with a withholding deduction. I don't have Income which I should.

unknown

Read the comment above yours from HockeyDoc. It's a step by step approach on how to accomplish what you need.

Additionally, DO NOT USE the SOLDX transaction type. You have to have TWO transactions, a SELL transaction which gives you the cash from the sale and then a separate transfer of cash using CASH TRANSFERRED OUT OF ACCOUNT to your checking account (or other account).

Using the SOLDX transaction will NOT record the proceeds as income.

unknown

I REMOVED the shares. Then created investment income less withholding for a deposit in checking.

unknown

You don't REMOVE the shares...you SELL the shares, which results in a cash amount. Then you transfer the cash to your spending account (checking, money market).

Do as you want...but you're doing it wrong. Removing shares has zero tax implications and is a complete mess for reporting your investment sales amount.

unknown

I don't know everything and that is why I came to this forum. I only have two options to move shares out of the account: SoldX and Remove. So going back to HoneyDocs reply: How do I "1. Sell the shares/units of the security to create a cash balance."?

unknown

In the investment account register, use the "Enter transactions" button on the upper left of the register.

Once you click on that you should see this screen:

Click on the drop box and select Sell - Shares Sold. Fill in the details. Record proceeds TO THIS ACCOUNTS CASH BALANCE.

Then, when completed, select Enter/New. From the drop down box select Cash Transferred Out of Account, select the account to transfer the proceeds to and the amount to transfer.

unknown

"To this accounts cash balance" is greyed out. Not an option.

mshiggins

How long have you had this account in Quicken? Or did you convert the file from MS Money?

It sounds like a single mutual fund account or an investment account with a linked cash account. Neither set up is possible to do now, but in the distant past, were possible.

Jim_Harman

Is this account set up as a Single Mutual Fund account in the Account Details? If so, To this account's cash balance will be grayed out because the account cannot have a cash balance.

If this is the case, I suggest you back up your data file in case something goes wrong, then select No for Single mutual fund account, even if the account only holds one fund.

unknown

mshiggins: Yes I have had Quicken for a long time. Entries go back to 2000. I may have used something else before, but it certainly wasn't MS Money.

Jim Harman: Yes as a Single. Converting has created the cash account option.

BUT: I still don't see investment income when I call up a budget report, monthly or YTD. The category is checked, appears, with zeroes.

unknown

Waiting for response !!! OR FIX
I'm chasing the same problem..
Other responses DO NOT understand problem !
Carl

SimonSezSo

I help my mom with her finances. The RMD distributions from her IRA do show up in the Tax Summary report I got them to show up by updating the "Tax Schedule" setting in her IRA Account Detail

Image httpsd2r1vs3d9006apcloudfrontnets3_images1769309RackMultipart20181229-4250-t8vp87-image_inlinepng1546113261

This way, the RMD transfers from her IRA are reflected in the Tax Summary report without including all transfers. I am using QWin 2019 R17.15.