How do I get 401(k) withdrawals to show on the tax report? (Q Mac)

Len

I get a monthly check from my 401(k), which I set up as a recurring income item containing a split with a withdrawal from the 401(k) account and the associated withholding items. It works fine, except the income does not show on the tax report, nor does it show in any of the cash flow accounts. I don't see a way to associate a tax line with a retirement account in the Mac version as exists in the Windows version. Help!

jacobs

You're correct that there's not an easy way to do this in Quicken Mac currently, because a transaction can't be both a transfer and categorized income at the same time. So you need a bit of a hack to make this work…

(1) In the 401(k) account, download or manually create a transaction to record the Sale of the security, creating a cash balance in the account.

(2) In the checking account, create a transaction to Transfer the cash out of the 401(k) account into the checking account. If federal and/or state taxes were withheld at the time of the sale, this transaction is a split, with one (or more) lines for the taxes withheld and one for the gross amount of the IRA sale. It's crucial that the transfer transaction with the splits must originate in the checking account, not the 401(k) account; if the split to record the income is in the 401(k) account, it won't show up in the Tax Schedule report because the Tax Schedule report bypasses retirement accounts. 

These steps get both accounts to have the correct dollar amounts: the 401(k) account is back to a zero cash balance, and the checking account has the correct cash received. But as you've seen, because Quicken Mac does not include retirement account transactions in the Tax Schedule report, the amount of the withdrawal -- which is taxable income -- does not show up on the Tax Schedule report. So here's where the hack is needed:

(3) In the same transaction in the checking 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 withdrawal. (2) Use category "Adjustment" for the negative of the same amount, because those categories are not included in any report.

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