Adding income tax to posted deposit?

Moskose

I receive a monthly check from an annuity account. The amount of the deposit shows up in my bank account but this does not show the gross about of the distribution, just the deposited amount, after taxes were paid. I have two questions here:
1. The withhold is exactly 25% so I tried grossing up the total and splitting the amount between the actual deposit and the tax withheld but this doesn't seem to work correctly. How should I modify the posted deposit or do I delete this and add a new one?
2. Same basic question for the future - I can schedule this to hit monthly once I know how to set it up properly. If I do this, will Quicken recognize this when it sees the monthly deposit hit my bank account?

jacobs

If I understand correctly, it sounds like you're approaching it right. Let's use some round numbers as an example:

You receive an annuity of $100. Of that, $25 is withheld for taxes, and $75 is paid to you. So you have a $75 deposit in your checking account, and want to account for the other pieces of this transaction. (It's really the same issue as a paycheck, with the transaction amount being the net pay, and the splits accounting for gross pay and taxes.) so your transaction would look like this:
  DEPOSIT    $75.00
     Split: Annuity income category   $100.00
     Split: Tax withholding category    -$25.00

Once you have this worked out, yes, you can save it as a scheduled monthly transaction. The next time a deposit comes in, you'll want to mark the scheduled transaction Paid (so it's a regular transaction rather than a gray one in your register)  and drag the downloaded deposit transaction over the manual one to merge them. Quicken should "learn" from this match and do it automatically next time. Or, at worst, it's just a simple drag to merge the transactions each month, or you could delete the downloaded transaction and keep the manually-created one. 

Moskose

...or will there be duplicate deposits?

jacobs

If I understand correctly, it sounds like you're approaching it right. Let's use some round numbers as an example:

You receive an annuity of $100. Of that, $25 is withheld for taxes, and $75 is paid to you. So you have a $75 deposit in your checking account, and want to account for the other pieces of this transaction. (It's really the same issue as a paycheck, with the transaction amount being the net pay, and the splits accounting for gross pay and taxes.) so your transaction would look like this:
  DEPOSIT    $75.00
     Split: Annuity income category   $100.00
     Split: Tax withholding category    -$25.00

Once you have this worked out, yes, you can save it as a scheduled monthly transaction. The next time a deposit comes in, you'll want to mark the scheduled transaction Paid (so it's a regular transaction rather than a gray one in your register)  and drag the downloaded deposit transaction over the manual one to merge them. Quicken should "learn" from this match and do it automatically next time. Or, at worst, it's just a simple drag to merge the transactions each month, or you could delete the downloaded transaction and keep the manually-created one. 

volvogirl

#1  You can't just gross up the net deposit.  It won't be exactly 25%.  It is not 25% of the net amount.  You need to know the actual Gross amount to begin with.  You should be getting a statement of the total and deductions.  Maybe you can go online and log into your annuity account and get it. Is it the same every month?  You probably have a new statement each year showing the amounts.

jacobs

If the withholding is exactly 25% of gross, as @Moskose says, then the gross-up from net is Net ÷ 0.75.

Moskose

Excellent and concise reply Jacobs! I was overthinking this but your example told me, very clearly, to indicate a split on the deposit, add 33% to the net deposit and code the net amount to income and the split function automatically had the correct tax amount waiting for me to assign it to taxes. - Thanks for the quick and very helpful response!