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Treasury Direct - T Bills

Philip107

I've started an account with Treasury Direct for transacting Treasury Bills. Probably will purchase varying maturities and was wondering what's a good way to track these as investments. So far I've created an investment account to transact money coming in from my checking account. Only have one so far and was just wondering what's the best way to carry this out in Quicken.

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Tom Young

Of course you use the money transferred from your checking Account into the Treasury Direct Account to buy the T-Bills using the Bonds Bought Action. Since the T-Bills are sold at a discount the pricing is typically along the lines of 9X.XXX times the number of $1,000 par bonds bought. In the Transaction List Quicken will convert that to a "Bought" action, adding a zero to the number of bonds bought.

You'll create your own security names so in the "Add Security to Quicken "window click on "Click here" down on the bottom of that screen to enter the information. You can keep it fairly simple. I've used the term of the bill and the maturinty date, like "4-Week T-Bill 5/31/22."

Quicken doesn't have a "Maturity" action so when the bill matures you can use the Bonds Sold Action using the same price that you used when you bought the bond, for no gain or loss. In the "Accrued Int" enter the actual interest income associated with the maturity, bringing the "Total Sale" number to (# of bonds bought) x $1,000.

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Tom Young

jb_dover

This method of entering the sale of the bond works in avoiding the sale as a capital gain; it creates a Misc Expense transaction entry in the Treasury Direct account before transferring the cash to connecxted bank account. The one problem is that the category "_Accrued Interest" is included as an expense when producing a category report. I attempted to change the "_Accrued Interest" to an income but that ended in disaster with quicken becoming very unresponsive until i restarted. Fortunately, after the restart, "_Accrued Interest" returned as an expense. The only work arround that I could find is to change the Misc Expense transaction type to Investment Income:int. It appears that after entering the Bond Sold as a single transaction in the Treasury Direct account, Quicken creates two separate transactions in that account which are no longer linked and can be modified independly. Anyone have a better solution?

Philip107

https://community.quicken.com/discussion/comment/20352704#Comment_20352704

Is the gain from a T-Bill regular interest or is it a capital gain?

Tom Young

I just did a test here using the proceedure above and it worked:

In my infrequent selling of bonds I generally do go ahead and simply create 2 transactions, one with a BondSold action and the other with an IntInc action, and I do that because _Accrued Int, in Quicken, is a Category that's actually intended for other purposes and shows up as a period expense/income when it shouldn't, but with discounted T-Bills having show up as a form of income does work fine.

Tom Young

@Philip107

It's interest. As I explained above if you want to have if labeled "Interest Income" make the maturity in two transactions.

stanray

Since it is reported on Schedule B:U.S Government Interest I would think using Sell Bonds and _Accrued Interest would be proper to report the interest earned. This goes directly to the point of it being Federally taxed but not State or local

drmike

My T-Bills are at a broker not Treasury direct. The broker just reports the transaction as a "Full Redemption" which doesn't help much.

I use a 3 entry transaction group in Quicken:

IntInc

RtrnCap

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