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Treat PreTax and After Tax Accounts Differently

IRAs and Roths are treated very differently, and are used differently for planning and for tax. Quicken should treat these differently. You could also run scenarios for future stock says to meet RMDs etc.
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  • Jim_HarmanJim_Harman SuperUser ✭✭✭✭✭
    Can you point to specific places in Quicken where this needs to be changed or improved?

    One area I can see is in the Lifetime Planner Quicken should have a separate section for tax free (Roth) accounts and compute RMDs based just on the projected balances in the deferred accounts.

    Funding sources for projected retirement spending should follow the generally recommended tax-efficient approach of RMDs from deferred accounts first, then pensions, social security and other fully taxable income, then income and other distributions from taxable accounts, then principal from taxable accounts, then Roth accounts, then additional money from deferred accounts.

    It appears that deferred and Roth accounts are currently lumped together.
    -- Jim QWin Premier subscription
  • mshigginsmshiggins SuperUser ✭✭✭✭✭
    In the Lifetime Planner, tax deferred and tax exempt distributions are correctly handled provided the accounts were created with the correct account type. 

    Quicken user since Q1999. Currently using QW2017.
    Questions? Check out the  Quicken Windows FAQ list
  • Where in the Account set up, can I choose that, there is only Tax Deffered YES or NO. There is no selection option. Im excited if its in there, but I still don't see it. Thanks mshiggins
  • Jim_HarmanJim_Harman SuperUser ✭✭✭✭✭
    When you set up an IRA account it asks what type of IRA it is - Traditional, Roth, etc. If you choose Roth for the account the Lifetime Planner does not include that account in the RMD calculation.

    I set up a test file with taxable, traditional IRA, and Roth accounts. I have not tested it exhaustively, but it appears that the LTP makes sensible decisions about which sources to tap to cover expenses in retirement: first RMDs, then Social Security and other taxable income, then principal from taxable accounts, then Roth.

    It is a little hard to see this because in the LTP there is one combined section for "deferred" accounts which includes any Roth accounts.  
    -- Jim QWin Premier subscription
  • Jim_HarmanJim_Harman SuperUser ✭✭✭✭✭
    Hopefully Quicken will update the LTP to reflect the recently enacted age increase for RMDs from 70 1/2 to 72.
    -- Jim QWin Premier subscription
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