The Community Meetup- August 2024 Edition

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What is Charitable Giving? A Guide for Quicken Users

By Janean Comfort

Charitable giving refers to the act of donating money, goods, or time to organizations or causes that help others in need. Whether you’re contributing to a local food bank, supporting a medical research fund, or donating to your favorite charity, these contributions can make a significant impact on your community and the world.

Why Track Charitable Giving in Quicken?

Tracking your charitable donations in Quicken can help you in several ways:

1. Stay Organized: Keeping all your donations in one place helps you stay organized. You can easily see how much you’ve given, to whom, and when.
2. Plan Your Giving: Setting goals for your charitable giving helps ensure you’re meeting your philanthropic objectives, whether it’s donating a specific amount each year or supporting multiple causes.
3. Tax Benefits: Many charitable donations are tax-deductible, meaning you can subtract them from your taxable income. By tracking donations in Quicken, you can easily compile the necessary information during tax season.
4. Review and Reflect: Quicken allows you to generate reports that provide insights into your giving patterns, helping you make informed decisions about future donations.

Getting Started with Charitable Giving in Quicken

If you’re new to tracking charitable giving in Quicken, here’s a simple guide to get you started:

1. Set Up a Category for Charitable Donations:
   • Go to your Category List in Quicken and create a new category specifically for charitable donations. This will help you separate these expenses from other spending.
2. Record Donations:
   • Each time you make a donation, enter the details into Quicken. Be sure to include the recipient’s name, the amount donated, and the date of the donation. This will keep your records accurate and up-to-date.
3. Attach Receipts:
   • Quicken allows you to attach digital copies of receipts or acknowledgment letters from the organizations you support. This is particularly useful for tax purposes.
4. Set a Giving Goal:
   • Decide on an annual or monthly giving goal. You can use Quicken’s goal-setting tools to track your progress and stay motivated.
5. Generate Reports:
   • Use Quicken’s reporting features to review your charitable donations over time. This can help you see the impact of your giving and plan for future donations.

By incorporating charitable giving into your financial management routine with Quicken, you’ll not only stay organized but also maximize the impact of your generosity. Whether you’re a seasoned philanthropist or just starting, Quicken’s tools can help you manage your charitable contributions effectively.

Tax Deductions

1. Tracking Tax-Deductible Donations:
   • Ensure that donations eligible for tax deductions are recorded accurately.
   • Keep digital copies of receipts and acknowledgment letters from charitable organizations as attachments in Quicken.
2. Preparing for Tax Season:
   • Use Quicken’s tax reporting features to generate a report of all your charitable donations for the year.
   • The report will categorize the donations and provide a total amount, making it easy to enter on your tax return.
3. Exporting Data:
   • If you use tax preparation software (e.g., TurboTax), you can export your charitable donation data from Quicken to streamline the tax filing process.

Visualization

1. Using Graphs and Charts:
   • Quicken allows you to visualize your charitable giving with graphs and charts.
   • Go to the "Reports & Graphs" menu, select "Graphs," and choose a graph type that best represents your data (e.g., pie chart, bar graph).
2. Reviewing Trends:
   • Look at trends in your charitable giving over time. Identify any peaks (e.g., holiday season) and plan accordingly.
   • Use these visual tools to stay motivated and ensure you meet your charitable goals.

How to Set Up Charitable Giving in Quicken Classic for Windows

1. Set Up a Charitable Donations Category:
   • Open Quicken and go to the Tools menu, then select Category List.
   • Click on Add Category.
   • Name the new category “Charitable Donations” and assign it to the Expense category type.
   • You can also create subcategories for specific charities if you donate to multiple organizations.
2. Record a Donation:
   • Go to the account register where the donation was made (e.g., checking account, credit card).
   • Click Add Transaction and enter the details of the donation, such as the date, amount, and the payee (the charity).
   • In the Category field, select “Charitable Donations.”
   • Add a memo or note if you want to include more details about the donation.
3. Attach Receipts:
   • After recording the donation, you can attach a digital copy of the donation receipt.
   • Click on the transaction, then select Attach to add a scanned receipt or PDF file.
4. Set a Charitable Giving Goal:
   • Go to the Planning tab and select Budgets.
   • Create a budget category for charitable donations and set an annual or monthly goal.
   • Monitor your progress towards the goal throughout the year.
5. Generate Reports:
   • Go to the Reports menu and select Spending or Itemized Categories.
   • Customize the report to include only the “Charitable Donations” category.
   • Generate the report to see a summary of your charitable contributions over a selected time period.

How to Set Up Charitable Giving in Quicken Classic for Mac

1. Set Up a Charitable Donations Category:
   • Open Quicken and go to Window > Categories.
   • Click the + button to add a new category.
   • Name the new category “Charitable Donations” and assign it to the Expense category type.
   • Similar to the Windows version, you can create subcategories for specific charities.
2. Record a Donation:
   • Go to the account register where the donation was made.
   • Click the + button to add a new transaction.
   • Enter the details of the donation, including the date, amount, and payee.
   • In the Category field, select “Charitable Donations.”
   • Add any additional notes or memos if needed.
3. Attach Receipts:
   • After recording the donation, you can attach a receipt.
   • Click on the transaction, then click the paperclip icon to add an attachment, such as a scanned receipt or document.
4. Set a Charitable Giving Goal:
   • Go to the Budgets tab and create a new budget.
   • Include “Charitable Donations” as a budget category and set a giving goal.
   • Use the budget tool to track your progress and adjust as needed.
5. Generate Reports:
   • Go to the Reports menu and select Spending by Category or Category Summary.
   • Customize the report to focus on the “Charitable Donations” category.
   • Generate and review the report to analyze your charitable contributions.

Question of The Month

What are some ways you track charitable giving?

Latest Releases 

The latest Quicken for Windows release was R58.9 which was a patch releases. This is now live and available to all users. The highlight from this release is:

• We fixed an issue where some customers incorrectly received the error, "Quicken's Online service is unavailable at this time. Please wait at least ten minutes, then try again. We apologize for the inconvenience." The proper result should have been a sign-in prompt.

Before you install any update, we recommend you perform a One Step Update. You should also make a backup of your data file. To see all the current releases for Windows, please visit this support article.

The latest release for Quicken Classic for Mac was 7.9.  Some highlights from this release are:

• You can now add and view attachments on accounts
• Added Security Detail view that displays information about a security including graph, price history, purchase history, and more
• We improved the register printouts so they now include starting and ending balance
• Fixed a bug that could cause duplicate securities to be added to the watchlist
• Fixed bugs that could cause the Update Accounts progress indicator to prematurely report that the update completed, or in some cases caused the indicator to continue spinning after an update had completed

To see all the current releases for Mac, please visit this support article.

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“Our leaderboard showcases top contributors for the month. Thank you for all of the insight, feedback and knowledge you share.”

Jim_Harman

With the large increase in the standard deduction in recent years, many taxpayers no longer need to track charitable contributions for tax purposes.

If you are required to take distributions (RMDs) from a Traditional IRA, it may be advantageous to use Qualified Charitable Distributions (QCDs) directly from the IRA rather than making cash contributions. Currently the process for recording QCDs in Quicken is quite cumbersome. There is an Idea post requesting that Quicken make this simpler, but for now here is a process that will get all the tax implications recorded correctly. With these entries, the Tax Planner, Tax reports, and spending reports all appear to be correct and no manual adjustments are required in the Tax Planner. The only difference is that the QCD gift amounts are shown in the IRA Contribution section of the Tax Planner.

1. Set up a special Expense category for QCDs. I called mine Charity-QCD. I gave it a Tax line item of "Form 1040:IRA contrib". I used that line item because it is an IRA-related expense and it reduces my taxable income by the amount of the donation so it calculates correctly in the Tax Planner.
2. Sell securities in the IRA if necessary to generate the cash for the QCD.
3. In a dummy taxable banking account, enter a Deposit transaction for the net amount of the donation, with a split if necessary for a transfer from the IRA for the gross amount of the distribution and any taxes withheld as a negative number. My state (CT) requires state withholding for all IRA distributions.
4. In the dummy account, enter a second transaction for the net amount of the donation, using the Charity-QCD Category. I use a second transaction to give the donation better visibility in the register and reports, and because Quicken tends to get confused if you enter a split transaction for a zero amount.
5. When the QCD transaction downloads from the FI, accept the matching security sale but delete or do not accept the downloaded cash transaction(s)

If you do want to track contributions directly, here are some suggestions.

If you want to use Quicken's built-in Categories, you can use the Charity subcategory under Gifts & Donations rather than creating a new Category for charitable donations.

As long as you use the charitable Payee names consistently, there is no need to create subcategories to track donations to multiple charities. You can customize the Itemized Payee report to include just your charitable donation Category and the report will show all your donations subtotaled by charity.

For tax deductible contributions to be included in the Tax Planner and Tax reports, your charitable donation Category must use the "Schedule A:Cash charity contributions" tax line item.

Donations of clothing and other items may also be tax deductible. In order to track these in Quicken, you can set up an Asset account with a value equal to an estimate of the value of your "stuff". Mine is called "Household goods". You can also set up a Category to track these donations, which should have the tax line item Schedule A:Non-cash charity contributions. Mine is called Charity-Non cash. When I donate an item, I go to the Asset account and enter the charity name as the Payee, the Charity-Non cash Category, and the item's value as a decrease. I add a description of the donated item in the Memo column.

Also it is often advantageous to donate securities that have appreciated in value. To accurately record the value and tax consequences of these donations, see this discussion

https://community.quicken.com/discussion/7421215/how-to-enter-in-securities-that-have-been-donated

Quicken Janean

Thanks @Jim_Harman for those insights and additional ways to use Quicken to track charitable giving.

BobP

Sure would be nice if there were an easy method to record the donation of stock to a charity. Should be a simple add to the list of transactions to be able to record a donation with the number of shares and price per share at the time of donation. Now it's a cumbersome series of steps to go through to record it as a sale of the stocks, then the donation of the cash as an expense. Shouldn't be that complicated, and its a popular method used for charitable giving, especially in a rising market.

Jim_Harman

@BobP I agree it would be nice if there was an easier way to record donated securities, but I don't think this scenario comes up often for most users.

You could create an Idea post for that and see how many votes it gets.

The current process (thanks to @q_lurker for this) is:

1. Go to the account that holds the shares you will be donating
2. Enter a Remove transaction for the shares to donate, usually selecting the lowest cost tax lot(s)
3. Add back the same number of shares, using the original acquisition date(s), current transaction date, and current fair market value
4. Sell the shares you just Added, using the current date and the same fair market value. There will now be cash for the amount of the donation in account, with no capital gain.
5. Enter a Misc Expense or Withdraw transaction to spend cash from the investment account with your Category for charitable contributions and a memo to explain