What does this message mean?

Question

I was adding a tax line category (IRA Contributions, self) to my pre-tax 403(b) account and this message popped up:  "Since you are setting a Transfers In link, any transactions in the Tax Impact account related to employee contributions should be deleted.  Should Quicken do this?"  I'm answering no, but I have NO idea what that means.  It kept my tax line category, but I'm curious what would've been deleted, and why?

Chris_QPW · Accepted Answer

Quicken maintains a hidden tax impact account.  That account has information in that it uses for things like tracking 401k/403(b) contributions.  Each time you use the paycheck reminder to put in contribution/transfer to your 401k/403(b) account they put a transaction in the tax impact account.

I'm not sure why its "disconnected" and asking about deleting it, when normally as you delete the entry in the Paycheck (or the whole paycheck transaction) it should take care of this, but that is what is going on.

When you look at the tax sections of Quicken the contribution might be wrong because of this.

Sherlock · Accepted Answer

Quicken may track the contributions to the account using a special built-in hidden account named: Tax Impact of 401(k) Accounts  To confirm, you may review the Income in Tax Summary report.  The message is alerting you to the possibility the change you're making may mean the contribution may be counted twice.