Appropriate category for IRA contribution?

aksdjfhlk23fkjhsa

I'm going through transactions in my Roth IRA, and I just noticed that when I made a cash contribution to the account, Quicken auto-categorized it as "uncategorized."

What category would this normally go in? (I didn't want to create a new category for something that already exists, since I would assume this is a pretty common financial transaction, it might be part of Quicken's default categories.)

volvogirl

Where did the contribution come from? Your checking account? It should be in your Checking Account (or whatever you used) as a Transfer to the ROTH IRA. Then you use the cash in the ROTH IRA to buy shares of a security or leave it as cash. Dont think you need a category on it in the ROTH IRA account.

Jon

If you're tracking both your Roth IRA and the account where the contribution came from, then it should be shown in Quicken as a transfer & those don't have categories; if anything, the category window should show "Transfer:" followed by the name of the account at the other end of the transfer.

If you're only tracking the Roth IRA account & not the account where the money came from (or vice versa), I don't know what category I would assign to that since it's neither income nor expense. Maybe just the word "Transfer" by itself. If you do want to show that money as an outgoing expense you'll have to make up your own category for that since I don't think there is one that's appropriate.

jacobs

This is not a Roth conversion is it? If so, there are some special steps to take to perform both the transfer and have it count as taxable income.

volvogirl

Where did the contribution come from? Your checking account? It should be in your Checking Account (or whatever you used) as a Transfer to the ROTH IRA. Then you use the cash in the ROTH IRA to buy shares of a security or leave it as cash. Dont think you need a category on it in the ROTH IRA account.

Jon

If you're tracking both your Roth IRA and the account where the contribution came from, then it should be shown in Quicken as a transfer & those don't have categories; if anything, the category window should show "Transfer:" followed by the name of the account at the other end of the transfer.

If you're only tracking the Roth IRA account & not the account where the money came from (or vice versa), I don't know what category I would assign to that since it's neither income nor expense. Maybe just the word "Transfer" by itself. If you do want to show that money as an outgoing expense you'll have to make up your own category for that since I don't think there is one that's appropriate.

jacobs

This is not a Roth conversion is it? If so, there are some special steps to take to perform both the transfer and have it count as taxable income.

aksdjfhlk23fkjhsa

(OP here.) Ah. Duh. Thank you. I figured it was something simple. It should be categorized as a transfer, since it's a transfer of money from one account to another.

THAT'S why I couldn't find the right answer when I tried searching for categories like "contribution" or "retirement" etc… :)

aksdjfhlk23fkjhsa

FOLLOW-UP question: I just discovered that in my wife's 403(b) account, she makes pre-tax contributions straight from her paycheck into the 403(b). These arrive in Quicken as uncategorized. Any thoughts on what I should categorize them as? These aren't transfers since they don't originate from any of my other bank accounts.

Chris_QPW

Actually, it is a transfer. The pre-tax contribution is a transfer to the from the paycheck. And then securities are bought from that cash balance.

This is from Quicken Windows and for my wife's 401K account, but it should be similarly recorded in Quicken Mac/403(b).

EDIT: It is the first transfer to the 401K account in this example. The second one is how Quicken Windows handles if the employer matches some of the contribution.

aksdjfhlk23fkjhsa

Thanks Chris. That seems like a lot of information to have to enter manually, every time a paycheck comes in!

Until now, I've been happy just to let the net amount hit the checking account, and categorize it as Paycheck. You think it's really worth it to input all of those 9 splits (from your screenshot) every time a paycheck comes in?

Chris_QPW

It is really, up to you and sort of depends on if the amounts change. If the amounts don't change then it becomes really easy, you just setup a scheduled reminder to enter the split transaction into the register and then Quicken will match the net amount when the transaction is downloaded.

In the case of my wife's, she is just working part time, so it varies and so what I have is a reminder that I do change the amounts for each week as I'm entering it into the register.

By having all the details you do get a better picture of the taxes and such, but it is entirely up to you.

Chris_QPW

Note if one doesn't want to treat it as a transfer and is looking for a "category", one I would be inclined to use whatever method Quicken Mac has for a "balance adjustment". That is the way that you can get money in or out of an account without recording it towards expense/income.

jacobs

That seems like a lot of information to have to enter manually, every time a paycheck comes in!

The good news is that you don’t have to enter all those splits every time you get paid; you set it up once and then reuse it each time thereafter.

For most people with regular paychecks, setting it up as a scheduled transaction does the trick. If you have irregular pay, you can create it as a saved QuickFill rule. (Post back if you need help with either of those.)

Iif your pay is the same each time, there’s nothing more you need to do. If your pay varies from check to check, then you edit the transaction to update the numerical values, but all the splits are already in place.