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Required Minimum Distributions Transferred to Brokerage Accounts (R59.6)

JLP1976

Release R59.6 noted a fix: Required Minimum Distributions (RMD transactions now correctly appear on tax report when transferred to brokerage accounts. I tried this today and found that a transfer from an IRA account to a brokerage account does show up in the Tax Schedule report, but it does not show up in the Tax Summary report or in the Tax Planner. I think this is due to the transfer not having a Quicken category attached to it. What am I missing here? How do I get the IRA to brokerage account transfer to populate the other tax related resources?

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fw6322+

https://community.quicken.com/discussion/7956108/required-minimum-distributions-transferred-to-brokerage-accounts-r59-6

Go to account details and check on the tax schedule information.

JLP1976

Update: I do have the Transfers out set to 1099R: Total IRA taxable dist. After reading some more discussion about this, this is the workaround that I will use.

Step 1: Use a "Cash Transferred out of Account" (XOut) transaction to transfer the distribution for the Tax Deferred account to a taxable account. This will register the distribution in the Tax Schedule report under the 1099-R schedule.

Step 2: Change the XIn transaction in the receiving account to a Deposit transaction and apply a Quicken category that is tied to "1099R: Total IRA taxable dist." Tax Line Item. This will register the distribution in the Tax Summary report and the Tax Planner.

Prior to the transfer fix in R59.6, I had been using a Withdraw/Deposit scheme to process these distributions. This required using a "dummy" category for the withdrawal. Now I can eliminate that part of the workaround. I just wish I would have to mess with the transaction to the desired result.

Jim_Harman

I have been using a similar workaround, but I enter a split Deposit in the receiving taxable account, where the first line of the split is a transfer from the IRA for the gross amount, and lines 2 and 3 are for the Federal and State taxes withheld, using appropriate Categories and entered as negative numbers. This appears as a WithdrawX in the IRA account. This has been working OK up to now. I have set up an income Reminder for this, so everything gets entered automatically. I must not accept the downloaded cash transactions from the IRA administrator.

I have requested information on exactly what has changed, but I think if they just changed it so that you can now enter an XOut for the net amount in the IRA account, that will not address the tax withholding.

There is an extensive discussion of this and related topics in this Idea post.

https://community.quicken.com/discussion/7864626/improve-handling-of-ira-distributions-including-qcds-and-roth-conversions

Quicken Jasmine

Hello @JLP1976,

It looks like you were taking Required Minimum Distributions from your IRA and had it set up correctly in Quicken’s tax schedule. The issue happened when you moved the money to your brokerage account—Quicken didn’t record the income properly in the Tax Schedule Report. However, it does work correctly when you transfer the funds to a checking account.

I hope this clears things up!

Jim_Harman

I agree with the issues reported by @JLP1976 . It appears that XOuts from an IRA to a brokerage account are still not recorded correctly in the Tax Summary report or the Tax Planner.

Prior to R59.6, if you entered an XOut in IRA with the cash going to a banking account, the tax schedule information was recorded as specified in the Account Details and thus appeared correctly in the Tax Schedule and Tax Summary reports and the Tax Planner. But if the destination was a taxable brokerage account, the tax schedule information was not recorded.

In R59.6, the Tax Schedule report is correct. The transfer to the brokerage account is missing from the Tax Summary report. In the Tax Planner, the totals in the Other Income > Taxable IRA and Pension section are correct but the transfer to the brokerage account is missing from the detail section at the bottom.

In this example, I made a $888 XOut from an IRA to a checking account on 9/25 and a $999 Xout from the IRA to a brokerage account on 9/26.

NotACPA

Add'l point re: this topic. My RMDs are transferred to a Linked Cash Account, that's actually the cash activity in my taxable brokerage account … and they show up properly in the Tax Schedule report.

SO, it would seem that only transfers directly to the brokerage account are impacted by this bug.

Jim_Harman

@NotACPA what release are you running? In R59.6, the issue the OP and I are seeing is with the Tax Summary Report.

In earlier releases I see the problem in both the Tax Schedule and Tax Summary Reports when a XOut entered in an IRA account sends money to a taxable brokerage account.

Also in all releases the taxable income is recorded correctly if you enter the transaction as a Deposit in either a banking or investing receiving account rather than an XOut in the IRA.

NotACPA

R59.6.

I transfer the full amount from my IRA to my LCA, split the txn in the LCA, subtract the taxes and Adjust to get the net deposit.

Saw the same before I updated yesterday.

It appears that Q doesn't consider the LCA to be a "brokerage" acct. Acct type is shown as "Checking"

And the action shown in my IRA (I've drawn from 2) is "WithdrwX", not Xout.

JLP1976

https://community.quicken.com/discussion/comment/20453903#Comment_20453903

@Jim_Harman Interesting catch on the Tax Planner. I was focused on the details, and did not pick up on the fact the top-level Taxable IRA/Pension Distributions is correct.

JLP1976

https://community.quicken.com/discussion/comment/20453881#Comment_20453881

@Quicken Jasmine You noted that Quicken did not record the income properly. I take that to mean the this will be corrected, as there should be no reason for a transfer into a taxable brokerage account to any different than any other taxable account i.e. a checking account.