TFSA Type not correct
I get it. Quicken has not really built a Canadian version, but rather has slapped a coat of paint on their US Software. But the least thing they could do is to ensure that they try and match similar account types. Case in point is the Canadian TFSA. When you go to set up a TFSA account it defaults to 'IRA' and this is just plain wrong.
The key features of a TFSA are:
- Contribute after tax dollars
- Gains accumulate tax free inside the account
- Withdrawals are not taxed
That more closely describes a Roth IRA.
"A Roth IRA is an Individual Retirement Account to which you contribute after-tax dollars. While there are no current-year tax benefits, your contributions and earnings can grow tax-free, and you can withdraw them tax-free and penalty free after age 59½ and once the account has been open for five years."
An IRA is similar to an RRSP in that you contribute pre-tax dollars, gains accumulate tax free, and you are taxed when you withdraw funds from the account.
However, Roth IRA does not show up as an option for the type of account. The US Version has a Roth IRA account type. Why can't Canadian Quicken use that instead of the IRA designation?
Comments
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Hello @TJTex,
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My financial advisor is now charging an advisor fee on all my accounts including my TFSA. I have been able to enter this as a MISCEXP in my Brokerage and RRSP accounts, but this is not an available action for the TFSA. Unfortunately when the TFSA account was created in Quicken back in 2018 it was setup as an "IRA" account. I was informed when I spoke with a Quicken support rep that expenses are not allowed in an US-based IRA account. The reality of Canadian TFSAs should be addressed in Quicken in such a way that expenses can be entered. (Withdrawals are a completely different concept within the mechanics of the TFSA)
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DanielT, I just tested entering a Miscellaneous Expense transaction in my TFSA and it works. It works the same way as entering a Miscellaneous Expense in an RRSP or a RRIF. I am assuming that is what you meant by a MISCEXP. I'm not sure why you are having an issue. When I set up my TFSA I also had it default to an IRA. I just left it as an IRA.
The key for me is that when setting up the TFSA as the IRA it goes through the whole series of questions about setting it up periodic deposits from your paycheck. Having the TFSA as an IRA also has the connotation of being taxable when you withdraw funds from the account. Although I don't know how that gets reported when you run a Tax Report, but I suppose you could always tailor the report to exclude transfers from your TFSA.
Also, you stated that "I was informed when I spoke with a Quicken support rep that expenses are not allowed in an US-based IRA account". I don't think that's correct. I have both the Canadian and US versions of Quicken and my IRA accounts in my US version will allow the entering of Miscellaneous Expense transactions.
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