_401EmploterContrib shows as debit to bank account in Net Worth report

I'm using the paycheck wizard and have the employer contribution to my 401k set up for my employers matches. The paycheck calculates correctly for the deposit into my checking account. When I run an Income & Expense report, the employer matches show up in the line labeled _401EmploerContrib as additional income. However, when I run the Net Worth report, the employer match is debited from the checking account yielding an incorrect ending balance. As a simple example of what I mean, i start with a zero balance in my checking account. My net paycheck is deposited in the amount of $100. Included in the paycheck template is an employer 401k match of $5. The ending balance in my checking is $100. The Income & Expense report shows net income of $100. However, the Net Worth report shows an ending balance in the checking account of $95, the $100 net deposit less the $5 employer match. When I double-click on the checking account balance in the Net Worth report, the resulting report shows the details of the paycheck deposit with a debit for the employer match included in the calculation detail.
I have read on here that there are recurring issues with Quicken's Net Worth reporting, but would like confirmation if this is just one of those issues or is there something I am missing. The biggest issue for me is that over the years the checking account balance shown in the Net Worth report becomes further from the actual balance because of the accumulation of all the employer matches that are deducted from the reported checking account balance.
Thanks for any help or guidance.
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Best Answer

  • Sherlock
    Sherlock SuperUser ✭✭✭✭✭
    Accepted Answer
    The _401EmployerContrib entry in the paycheck transaction should be balanced by the transfer to the 401k account.  I suggest you review the customization setting of the Networth report to determine why the _401EmployerContrib category is being excluded: open the report and press Alt + C

Answers

  • btcwgt
    btcwgt Member
    Of course, I noticed the misspelling in the title just as I hit the Ask Question button, lol.
  • Frankx
    Frankx SuperUser ✭✭✭✭✭
    edited June 2020
    Hi @btcwgt,

    Can you tell me how the payroll entry is currently being recorded in Quicken - are you making a manual entry or is the entry/transaction being downloaded?

    Frankx


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  • btcwgt
    btcwgt Member
    I set up a manual entry using the Quicken payroll wizard to have all the pre and post tax deductions from gross income. The only thing downloaded is the net deposit from my bank using One Step Update.
  • Sherlock
    Sherlock SuperUser ✭✭✭✭✭
    Accepted Answer
    The _401EmployerContrib entry in the paycheck transaction should be balanced by the transfer to the 401k account.  I suggest you review the customization setting of the Networth report to determine why the _401EmployerContrib category is being excluded: open the report and press Alt + C
  • Frankx
    Frankx SuperUser ✭✭✭✭✭
    Okay, so I believe the problem is that you may not be recording the "income" of $5.00 that is the employer match. 

    So to be more specific - that $5.00 match is not included in "gross wages" - it is in addition to the gross wages.  On the pay stub they don't add that to gross pay because it is not taxable now and won't be taxable until it is paid out from the plan eventually after retirement. 

    So if you are going to record that "income" in Quicken now (many people don't), you need to have an off-setting "credit" that you should record in an income category (such as "Comp401k", or "Employer benefit" or something similar).  Once you do that your entry and report should balance.

    Let me know if you have any followup questions.

    Frankx


                           Quicken H&B-Subscription - Windows 10 Home - Ver. 2004
                                             - - - - Quicken User since 1984 - - - 
      -  If you find this reply helpful, please click "Helpful" (below), so others will know! Thank you.  -
  • btcwgt
    btcwgt Member
    Thanks to both Sherlock and Frankx. I resolved the issue with both of your inputs. For some reason, the default setting was to not include hidden categories in the Net Worth report, which left _401EmployerContrib excluded, which forced that value it to show up as a debit in the checking account in the Net Worth report.
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