Getting _divinc as catagory in tax-deferred account

gh423

All my tax-deferred accounts Dividends are getting put into the _devinc catagory. I believe it should be _devincTaxFree . how can i fix this?

Jim_Harman

It sounds like you are entering the distributions from the IRA as withdrawals.

For best results, you should record the distribution by starting in the taxable account.

Enter a deposit transaction in the taxable account with a split where the gross amount has a category of the IRA account in [brackets]. This will be a transfer from the IRA. Then enter the tax withheld as another split with a negative number. The deposit will be the net amount.

Now your tax reporting will be correct and the IRA distributions will show as income.  

Jim_Harman

The Tax reports exclude tax deferred accounts so you will not see the dividends there. If you want to exclude the dividends and other distributions in tax deferred accounts from other reports, you should exclude the accounts from those reports. 

_DivIncTaxFree is for securities like municipal bonds and muni bond funds.

Frankx

Hi @gh423,

Just an FYI, tax deferred doesn't mean that the dividends will not be taxed (i.e. tax-free) it just means that the income is not currently taxed.  Eventually, tax-deferred income is eventually subject to tax.  It is "as certain as death and taxes"  to coin a phrase.

And, as @Jim_Harman mentioned, Quicken treats tax-deferred accounts - like IRA's and profit-sharing accounts as tax deferred until such accounts are paid out.

Frankx

gh423

I agree with all that has been said. Let me give you the specific issues I am having. I am making my budget. I would like to include dividends as income and taxes as an expense in my actual column in budget reports. If I enable the IRA accounts the budget includes all the dividends in the tax deferred account as dividend income. But I do get the taxes that are withheld for withdrawals included the expense section. If I don't include the IRA accounts, I get the correct dividends, but do not get the taxes. This happens in the tax reports also. Include the IRAs and get the incorrect taxable dividends (and short and long term gains, etc also) but the taxes paid from the IRA do get included in the report. Exclude the IRA accounts for the tax reports and you get the correct taxable dividends shown but no taxes paid are shown in the report.

Quicken should know that dividends, long term and short term gains, etc from what it knows are non-taxable accounts should not show up as income in budget or tax reports. As was pointed out anything in a traditional IRA is only taxed and counted as income when it is withdrawn.

Also if the IRAs are included in the tax reports, it also gets the gross distribution wrong. It shows only the amount that is transferred out and neglects to include the taxes withheld from the gross distribution. Effectively giving the net distribution, not the gross distribution which it claims it is showing.

q_lurker

See this FAQ for the best way to handle tax withheld from IRA distribution 
https://community.quicken.com/discussion/comment/17093491#Comment_17093491

Jim_Harman

It sounds like you are entering the distributions from the IRA as withdrawals.

For best results, you should record the distribution by starting in the taxable account.

Enter a deposit transaction in the taxable account with a split where the gross amount has a category of the IRA account in [brackets]. This will be a transfer from the IRA. Then enter the tax withheld as another split with a negative number. The deposit will be the net amount.

Now your tax reporting will be correct and the IRA distributions will show as income.  

gh423

Thanks Jim. This works, but the taxes now look like they were paid from the taxable account instead of where they were actually paid from. It also means that for every distribution, you have to manually fix what is downloaded from the IRA and destination account. I had to delete 3 entries, the withdrawal and the two taxes paid (fed and state) in the IRA. And fix the downloaded deposit in the destination account. I don't do many distributions so not a big deal for me. But if I had it set up to do it monthly that would be painful.

I still think that Quicken should have either a different code for IRA dividends, intensest, gains, etc or understand how a non-taxable account works for these categories. Then the user would not have to fix their downloads to make it easier for quicken. Its supposed to be the other way around. Easy for the user,

But thanks again for the workaround. This makes it work for the budget and tax reports.

Jim_Harman

Remember that downloaded transactions are not Quicken's; they are formatted by your financial institution.

Quicken already has the tax line items you need for the withholding in the 1099R section; you can create Categories that use these as needed. In the IRA account details, you should make sure the Transfers out tax line item is set to 1099R: Total IRA taxable distribution

If you would like Quicken to improve the way it handles IRA distributions and related transactions, please review, comment, and vote for this product idea post
https://community.quicken.com/discussion/7864626/improve-handling-of-ira-distributions-qcds-and-roth-conversions

To vote, click on the small arrow under the number in the big blue box in the first post of the thread. Every vote counts!