Tax Planner doesn't exclude YTD 401k Employee contributions from AGI

I've been using Quicken for over 25 years and have notified Tech Support several times that the Tax Planner doesn't properly exclude Employee 401K contributions from projected Adjusted Gross Income (AGI). Strange that Quicken has partially fixed this but not completely. Future 401k contributions are now properly being excluded (drilling into Wages detail Red=Future scheduled paychecks). However YTD 401k employee contributions are not shown as negative in YTD detail (blue). In fact they are missing completely. My workaround has been to enter a negative adjustment to wages. Frustrating!

Best Answer

  • Frankx
    Frankx SuperUser ✭✭✭✭✭
    Accepted Answer
    Hi again @KRFCPA,

    I believe that your gut reaction (to make manual TP adjustments) was the best course of action.

    Frankx

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Answers

  • Frankx
    Frankx SuperUser ✭✭✭✭✭
    Hi @KRFCPA,

    I am not seeing this behavior. On the contrary, myTax Planner is properly deducting employee 401k withholdings from gross wages.  What versions of Quicken and Windows are you using?

    Frankx

                      Quicken H&B-Subscription Ver. 34.24 - Windows 10-Home Version
                                             - - - - Quicken User since 1984 - - - 
      -  If you find this reply helpful, please click "Helpful" (below), so others will know! Thank you.  -

  • KRFCPA
    KRFCPA Member ✭✭
    Quicken H&B 2020 Subscription-Ver.R28.24. Build 27.1.28.24. Windows 10. Ver.1903. Quicken User since 1995.
  • Frankx
    Frankx SuperUser ✭✭✭✭✭
    Just wondering - you say that future 401k transactions are being handled properly - Did you change anything about the way you are entering or coding those new entries?

    Frankx

                      Quicken H&B-Subscription Ver. 34.24 - Windows 10-Home Version
                                             - - - - Quicken User since 1984 - - - 
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  • markus1957
    markus1957 SuperUser, Windows Beta Beta
    That behavior can mean the link between the 401K account and the hidden account "Tax Impact of 401(k) Accounts" has been broken.  You need to look in that hidden account and the tax line assignment in the Tax Planner and see if they are correct.

    It sounds like the link is broken and the entered transactions are not getting entered into the hidden account.

    Use the back door method in this link (don't think the other one works anymore) to check out the transactions in the hidden account. 
    https://community.quicken.com/discussion/comment/17153098#Comment_17153098
  • KRFCPA
    KRFCPA Member ✭✭
    No change. It's simply the same bi-weekly paycheck created at Paycheck Setup Wizard (using Gross Amount-detail method). I setup as reminder & like to add to register up to one month in advance. So in Tax Planner, my October 2020 paychecks (already entered) are not properly excluding 401k withholdings. However Nov-Dec 2020 future withholdings are excluded. Strange indeed!
  • KRFCPA
    KRFCPA Member ✭✭
    Just to add that in Tax Planner, Jan-Sept 2020 401k withholdings are not being backed out of income either.
  • markus1957
    markus1957 SuperUser, Windows Beta Beta
    I just tested a Paycheck wizard entry and it works as expected. Entered paychecks show 401k contributions as deductions in Tax Planner. Scheduled paychecks are also shown as expected.

    You should verify the Category "_401Contrib" is assigned to the register entries in the hidden account and that all entered paycheck entries are shown in the hidden account register.


  • markus1957
    markus1957 SuperUser, Windows Beta Beta
    Adding-  I found my response to this issue from last year.  Hope it provides a better explanation.
    https://community.quicken.com/discussion/comment/20009180/#Comment_20009180
  • KRFCPA
    KRFCPA Member ✭✭
    @markus1957 : I just generated that FindReplace report, but nothing found (empty). Yes, my problem is precisely like last year's 20009180# posting. Even Validation didn't help. I did notice that the 401k account is setup without pointing anything in the Tax Schedule/TransfersIn/TransferOut. I don't want to use the backdoor method as retiring next year. Easier to just make manual TP adjustment. Thank you for your help.
  • KRFCPA
    KRFCPA Member ✭✭
    @markus1957 : Cautionary Tale. After making backup, I just setup the Tax Schedule Transferin to point to W2 Wages:Self. However, when Quicken prompted "Since you are setting a Transfer-in link, any transactions in the Tax Impact account related to employee contribution should be deleted. Should Quicken do this? (YES OR NO)" I answered No (first time), then after restoring & trying again (YES-2nd time). Either way screwed up the Tax Planner by deducting both Employer and Employee contributions from Gross Wages! So, it seems the Tax Schedule should be left blank on 401k setup?
  • Frankx
    Frankx SuperUser ✭✭✭✭✭
    Accepted Answer
    Hi again @KRFCPA,

    I believe that your gut reaction (to make manual TP adjustments) was the best course of action.

    Frankx

                      Quicken H&B-Subscription Ver. 34.24 - Windows 10-Home Version
                                             - - - - Quicken User since 1984 - - - 
      -  If you find this reply helpful, please click "Helpful" (below), so others will know! Thank you.  -

  • markus1957
    markus1957 SuperUser, Windows Beta Beta
    Yes, the Tax Schedule Transfers In should be left blank for normal 401k uses, for the reason you discovered; no appropriate tax line is found in the pull-down.  The workflow you encountered does raise an interesting question as to whether that process might somehow be exploited to restore the link between the 401k account and the hidden Tax Impact account.  I had thought the only way to resolve it was to create a new 401k and use that link, then move transactions from the old account.

    The fact that you have no entries in Tax Impact, as evidenced by the empty Find search indicates that the register entries could have been deleted by that very process at some point in the past.

    A way to test whether it can be restored would be to see if after toggling and answering No (Yes, would cause the undesired deletion), then after closing and opening Quicken, switching back to a blank tax line, does entering a Paycheck reminder behave as it should as shown in my screenshot. Working on a file copy should keep you from causing worse damage to the file as long as you don't perform any One Step Updates with the file.  Chances are slim but you are most of the way to the answer.
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