401K withdrawl Tax

How do I enter the taxes taken out of my 401k drawl ? Is there a seperate category?

Best Answer

  • NotACPA
    NotACPA SuperUser, Windows Beta Beta
    edited May 16 Accepted Answer
    Expanding upon Tom's reply, ANY tax-related withholding can NOT be recorded in a tax-deferred account in Q.
    SO, what you need to do is to transfer then entire amount to a taxable account (probably your checking account) and then split the transaction to show the entire amount coming from  the 401k and than a 2nd line of the split showing a NEGATIVE amount going to the tax withholding category.  Then "Adjust" the transaction so that only the after tax amount is actually deposited to checking.
    E.G.
    Total transaction,originally $5,000
    1st line of split:
         Transfer from 401k       $5,000
    2nd line of split
          Tax category              - $1,000
       Then there will be a line with no category for -$1,000 ... DELETE IT
    Click the adjust button and click  OK
    NEW Total transaction        $4,000 (which is what your checking actually receives0
    Q user since DOS version 5
    Now running Quicken Windows Subscription,  Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP

Answers

  • Tom Young
    Tom Young SuperUser ✭✭✭✭✭
    If you're referring to a "Quicken Category" for "taxes withheld from 401(k) distributions", there isn't one, but you're certainly free to create one if you wish. 
    However, there's no real difference, at the income tax level, of how or where taxes are withheld so you can simply continue to use the Category that you'd use for taxes withheld from paychecks and the like.
  • NotACPA
    NotACPA SuperUser, Windows Beta Beta
    edited May 16 Accepted Answer
    Expanding upon Tom's reply, ANY tax-related withholding can NOT be recorded in a tax-deferred account in Q.
    SO, what you need to do is to transfer then entire amount to a taxable account (probably your checking account) and then split the transaction to show the entire amount coming from  the 401k and than a 2nd line of the split showing a NEGATIVE amount going to the tax withholding category.  Then "Adjust" the transaction so that only the after tax amount is actually deposited to checking.
    E.G.
    Total transaction,originally $5,000
    1st line of split:
         Transfer from 401k       $5,000
    2nd line of split
          Tax category              - $1,000
       Then there will be a line with no category for -$1,000 ... DELETE IT
    Click the adjust button and click  OK
    NEW Total transaction        $4,000 (which is what your checking actually receives0
    Q user since DOS version 5
    Now running Quicken Windows Subscription,  Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP
  • lmsandling
    lmsandling Member ✭✭
    Thanks so Much
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