401k Rollover to Traditional IRA

roger

I recently left my employer, and had to roll over to my existing traditional IRA. But in Quicken, it's still there, and I need a way to perform the "virtual" rollover. Unfortunately, the incoming transaction to my IRA has already been downloaded and entered. But I am left with the 401k, which I need to close out manually. Any help would be appreciated! There were many holdings, and if I am supposed to "sell" them manually. How accurate does this need to be for taxes when selling the 401k holdings for a rollover to a traditional IRA? OK, that's 2 questions, but they are related.

Tom Young

The correct way to handle this in Quicken is to initiate a "Shares transferred between accounts" in the old 401(k).  Quicken will do one "Remove" action for each security in the 401(k) leaving that Account zeroed out.  Quicken will do one "Add" action for each lot of each security in the new IRA.  That leaves the history of transactions in the 401(k) and establishes each security in the IRA with correct dates and bases.

NotACPA

In that case, you should record in Q a SALE of each security held in the 401(k), and then a "Cash transferred out of account" to move the funds to your IRA.

Then, with the cash in the IRA, you can record the purchase of whatever securities you bought there.

Tom Young

The "transferred" action is completely analogous to a rollover. 

Since you transferred cash, not stock, you'd need to do a "sell" in the old 401(k) and then do a "Cash Transferred Out of Account" action. 

If all the cash deposited in the old 401(k) account was pre-tax you have no basis in the account so you could simply sell the old securities at any price as long as the total cash equaled the amount transferred.  If would be nice to know what each security sold for just to see how those securities worked out as investments; I'd guess that information is available somewhere.  But the "gains and losses" on the sale(s) are pretty much irrelevant, tax-wise.

Tom Young

The correct way to handle this in Quicken is to initiate a "Shares transferred between accounts" in the old 401(k).  Quicken will do one "Remove" action for each security in the 401(k) leaving that Account zeroed out.  Quicken will do one "Add" action for each lot of each security in the new IRA.  That leaves the history of transactions in the 401(k) and establishes each security in the IRA with correct dates and bases.

roger

> @"Tom Young" said:
> The correct way to handle this in Quicken is to initiate a "Shares transferred between accounts" in the old 401(k).  Quicken will do one "Remove" action for each security in the 401(k) leaving that Account zeroed out.  Quicken will do one "Add" action for each lot of each security in the new IRA.  That leaves the history of transactions in the 401(k) and establishes each security in the IRA with correct dates and bases.

Thank you!

roger

> @roger said:
> > @Tom Young said:
> > The correct way to handle this in Quicken is to initiate a "Shares transferred between accounts" in the old 401(k).  Quicken will do one "Remove" action for each security in the 401(k) leaving that Account zeroed out.  Quicken will do one "Add" action for each lot of each security in the new IRA.  That leaves the history of transactions in the 401(k) and establishes each security in the IRA with correct dates and bases.
>
> Thank you!

There is a snafu in that... the holdings are not really in my IRA. They were liquidated, so cash should be the only thing entered into the IRA. Perhaps I need to create a temporary account to receive the holdings? I'd still need to "sell" and then transfer the resulting cash into the IRA account.

Why doesn't Quicken have a "Rollover" option in the investment accounts that qualify?

NotACPA

In that case, you should record in Q a SALE of each security held in the 401(k), and then a "Cash transferred out of account" to move the funds to your IRA.

Then, with the cash in the IRA, you can record the purchase of whatever securities you bought there.

Tom Young

The "transferred" action is completely analogous to a rollover. 

Since you transferred cash, not stock, you'd need to do a "sell" in the old 401(k) and then do a "Cash Transferred Out of Account" action. 

If all the cash deposited in the old 401(k) account was pre-tax you have no basis in the account so you could simply sell the old securities at any price as long as the total cash equaled the amount transferred.  If would be nice to know what each security sold for just to see how those securities worked out as investments; I'd guess that information is available somewhere.  But the "gains and losses" on the sale(s) are pretty much irrelevant, tax-wise.

roger

Thanks to y'all... I got it cleaned up. I was a little too fast to close the 401k account after I had done the Share Transfer... my bad. However, since my IRA had already downloaded the cash deposit, all I needed to do was delete the transferred shares, and the balance is now correct. I see in the closed 401k that the stocks were transferred, not sold, but I will have to deal with that later. At least I know the transaction date.