Investing Split Transaction not handled properly

Ed V

I have added split transactions in my IRA account for a normal monthly distribution dated yesterday 1/72024 (not future dated). Split includes two lines: [Checking Account] and Federal Taxes

I just noticed my account balance is messed up in the net worth report and account balances are not shown correctly under certain interval selections. If I set the report to Yearly, Current Year, Monthly columns the ending balance for last year is correct. If I change to Yearly, 2023, Monthly columns the ending balance for last year is incorrect. It is lower by an amount different than the split transaction or each of the split amounts. If column selection is set to none then the totals are correct. If I change the split transaction to two separate entries all reports are showing correct.

Anyone else using split transactions for expenses in an investing register successfully?

Jim_Harman

This is not directly related to your question, but when recording IRA distributions, you should not be entering a split transaction in the IRA account for the tax deduction. The reason is that if you do it that way, the deduction will not be picked up by the Tax reports or the Tax Planner.

Here is a "Cheat sheet" for entering IRA distributions:

In the IRA, click on the gear at the top right and select Edit account details. Click on Tax Schedule and set Transfers out to 1099R: Total IRA taxable distrib., like this:

For the taxes to be recorded properly in Quicken, the transfer must be entered as a transaction in the receiving account. It can be a banking or an investing account, but it must be taxable, not another IRA for example.

In the receiving account:

1)  Enter a Deposit transaction for the net amount of the RMD...a positive number.

2)  Split the category:

• Line 1 of the split:  Category =  the IRA account name in [square brackets] and the gross distribution amount...a positive number.
• Line 2 of the split:  Category = the Fed taxes withholding category that you use...a negative number.
• Line 3 of the split:  Category = the State taxes category that you use...a negative number.
• Total of the split:  Must equal the net amount of the deposit.

If you receive the distributions regularly, you can set up this transaction as an Income Reminder.

In the IRA account:  Delete any downloaded brokerage transactions for

• The net distribution
• The Fed taxes withheld
• The State taxes withheld

With this setup, the taxable income will be shown in the “1099-R Total IRA Taxable distrib.” and the tax withholding in the withholding sections of the Tax Schedule report, and the Tax Planner will handle the distribution correctly.

Chris_QPW

It sounds like you found some bug in the reporting, but it also sounds like you did the withdraw wrong so that it is properly recorded for tax purposes.

Quicken will not normally include any tax entry that is recorded in an IRA because it is "tax deferred".

The proper way to record this is to transfer the gross amount to the checking account with it split between the transfer and the tax category.

Ed V

Thanks Jim and Chris.

I started entering the split in the IRA account because I also had separate transactions in the IRA for payments to the IRS. I didn't want to enter net zero split transactions in another account to handle these IRS payments. Since the Net Worth report is more important to me than the tax reports, I will change the distribution transactions to splits in checking per your detailed instructions (thank you!). This corrects the Net Worth and Account Balance reports.

I created my own tax reports that I export to Excel to handle tax planning, as I also have nondeductible contributions to the IRA that I need to manage.

Thanks again!

Jim_Harman

I had problems years ago with split investing cash transactions in spending reports, but they are resolved as far as I know. My original workaround was to enter multiple transactions rather than splits.

As I understand this issue it is with the Net Worth report when there is a split Withdraw transaction in an Investing account in Jan 2024. The report is OK if the Interval is set to None and the date range is either Yearly/current year or Yearly/2023.

But if the date range is Yearly/current year and the Interval is set to Monthly, the 12/31/23 balance for the account with the split transaction is incorrect.

Do I have that right?

I tried to replicate this scenario but there is no error for me.

Ed V

yes that’s correct

Ed V

I've been using split investment account transactions in my IRA for the last several years. My January 2024 split entry caused the problem with the 2023 ending balance in the reports. I checked 2022 and 2021 and the reports are correct. Once I created a split transaction in checking for Jan-2024 the 2023 ending balance was correct. Weird that it only happened with the 2024 transaction…