Quicken Mac needs a feature for IRA RMD withdrawals

jacobs
jacobs SuperUser, Mac Beta Beta
edited March 2021 in Investments (Mac)
Many Quicken users are past the age where they need to take withdrawals from their IRA accounts annually, but Quicken Mac lacks any facility for doing such a withdrawal and having it show up in the Tax Schedule report. It needs one!

See below for more details. Vote below for this feature to be added to Quicken Mac.
Quicken Mac Subscription • Quicken user since 1993
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  • jacobs
    jacobs SuperUser, Mac Beta Beta
    Currently, a user needs to do some contorted gymnastics to post a sale in their IRA account, transfer the funds to a non-IRA account, and show that amount as taxable income from a retirement account:

    (a) In the IRA account, create a transaction to record the Sale of the security, creating a cash balance in the account.

    (b) In a checking, savings or non-retirement investment account, create a transaction to Transfer the cash out of the IRA account into the receiving account. If federal and/or state taxes were withheld at the time of the sale, the transaction is a split, with one (or more) lines for the taxes withheld and one for the gross amount of the IRA sale.

    These two steps get both accounts to have the correct dollar amounts: the IRA account is back to a zero cash balance, and the receiving account has the correct cash received. But because Quicken Mac does not include IRA account transactions in the Tax Schedule report, the amount of the RMD -- which is taxable income -- does not show up on the Tax Schedule report. So the user needs to know or figure out some work-around tricks:

    (c) In the same transaction in the receiving account which does the transfer, add two more split lines: (1) Use Category "Personal Income:Taxable IRA Withdrawal", which is assigned to the proper 1099-R tax line for the Tax Schedule report, with the amount of the total RMD withdrawal. (2) Use category "Adjustment" or "Transfer" for the negative of the same amount, because those categories are not included in any report.

    (d) The transfer transaction with the splits must originate in the checking or receiving account, not the IRA account; if the split to record the income is in the IRA account, it won't show up in the Tax Schedule report because the Tax Schedule report bypasses IRA accounts. 

    It should be apparent that step (c) is not intuitive and is clearly a hack to make things work. And step (d) is not intuitive to users accustomed to linked transfers being able to be entered in either of the accounts involved.

    Note: there is currently another work-around for (c): make the transfer split also have a category of "Personal Income:Taxable IRA Withdrawal". We've been told Quicken management is going to remove the ability to have transfers (cash flow transactions) which also have categories (income/expense transactions) because it violates the rules of accounting -- but this loophole currently still remains in Quicken. Since we've been told this loophole will be removed, this can't be the recommended procedure for Quicken Mac users to use. 
    Quicken Mac Subscription • Quicken user since 1993
  • When I asked for information on minimum required distribution specifically for the Mac edition, I am referred to answers for the Windows edition. Until I found this discussion, I was not aware that the Mac edition did not provide a straightforward way to cope with what can be a rather complex tax issue, especially for those of us who have recently started receiving IRA payments.
  • garysmith87
    garysmith87 Member ✭✭✭✭
    When I asked for information on minimum required distribution specifically for the Mac edition, I am referred to answers for the Windows edition. Until I found this discussion, I was not aware that the Mac edition did not provide a straightforward way to cope with what can be a rather complex tax issue, especially for those of us who have recently started receiving IRA payments.
    You can also find this discussion, which has "real life" screenshots to help.

    https://community.quicken.com/discussion/7902160/help-with-rmd-adjustment


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  • Marc
    Marc Member ✭✭
    Thanks for the input. I do hope quicken fix this oversight. Now that I went though and made new transaction and deleted the old ones, how do I change the cleared status to a green check mark? In the past I thought you could just click on the status and it would rotate through the options, so the next time I reconcile the bank account they don't show up as unreconciled.
  • jacobs
    jacobs SuperUser, Mac Beta Beta
    @Marc One click on the empty Clr box creates a blue check mark; then Option-click to turn it to a green check mark.
    Quicken Mac Subscription • Quicken user since 1993
  • Marc
    Marc Member ✭✭
    Option Click. Ahh. thank you
  • jacobs
    jacobs SuperUser, Mac Beta Beta
    Adding another use case here: a user who transfers some money from a traditional IRA (or 401k) account to a Roth IRA account. Roth conversions are taxable income, even though the transfer of funds is between two retirement accounts. So just like the example above, a user currently has to create a "trick" transaction to create taxable income in the Quicken tax report:

    In a checking account (or any non-retirement account), create a transaction with an Amount of zero. In the splits tab and add two split lines: (1) Use category "Personal Income:Taxable IRA Withdrawal", enter the amount of the Roth conversion as a positive number; and (2) Use category "Adjustment" with the same amount as a negative number.

    What's needed for Roth conversions to work without hacks like this is for Quicken to continue to ignore investment income in retirement accounts but create an exception for the category "Personal Income:Taxable IRA Withdrawal"; any use of that category should show up in the Tax Schedule report. 
    Quicken Mac Subscription • Quicken user since 1993
  • register one more vote for an easy way of registering RMD from IRA accounts as taxable income...