Tax Schedule Report Incorrectly Reflects W2 After-tax Deduction as Pre-tax

BruceManno
BruceManno Quicken Windows Subscription Member ✭✭

I added an "Other After-Tax Deduction" line item in my paycheck and that amount is reflected as pre-tax when viewing my W2 in Reports>Tax>Tax Schedule>W-2>Salary or wages, self.

Answers

  • NotACPA
    NotACPA Quicken Windows Subscription SuperUser ✭✭✭✭✭

    What Tax line did you associate with the line/category? It's the Tax lines that determine where an item appears in Tax reports, not it's placement in the Payroll wizard.,

    Q user since February, 1990. DOS Version 4
    Now running Quicken Windows Subscription, Business & Personal
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  • BruceManno
    BruceManno Quicken Windows Subscription Member ✭✭

    Thank you for your response. I assigned it to "Salary or wages, self" since it's part of my paycheck and that's where it shows as negative (pre-tax) reducing my Salary.

  • NotACPA
    NotACPA Quicken Windows Subscription SuperUser ✭✭✭✭✭
    edited January 18

    And, that's why it's an negative amount. Because "Salary" is normally a positive number, but by using it in "After Tax Deduction" you turned it into a negative.

    SO, what is actually this item that we're discussing?

    Q user since February, 1990. DOS Version 4
    Now running Quicken Windows Subscription, Business & Personal
    Retired "Certified Information Systems Auditor" & Bank Audit VP

  • Jim_Harman
    Jim_Harman Quicken Windows Subscription SuperUser ✭✭✭✭✭

    An after tax deduction will reduce your paycheck but not your taxable income.

    I think it should be entered with an expense Category or the name of a transfer account in [square brackets] and not Salary or Wages - Self.

    QWin Premier subscription
  • BruceManno
    BruceManno Quicken Windows Subscription Member ✭✭

    Thank you for your replies. I thought that I can share screen shots to show the issue. The paycheck screenshot correctly reflets the W2 Gross as $7,380.07; however, the Tax Schedule report reflects an incorrect amount of $7,376.42. Difference of $3.65 since Tax Schedule treats it as pre-tax incorrectly.

  • Jim_Harman
    Jim_Harman Quicken Windows Subscription SuperUser ✭✭✭✭✭

    The $3.65 deduction is because you are transferring it to a 401(k) account. I think if you set it up using the Roth 401(k) option in the after tax deductions it may work

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  • BruceManno
    BruceManno Quicken Windows Subscription Member ✭✭

    Thank Jim. That does work; however, Quicken only allows you to use the Roth 401(k) after-tax deduction option once (screen shot below). I contribute to both a 401k & Roth each paycheck and Fidelity requires 1% of your contributions to go into a separate account to pay for fees. The $3.65 is 1% of my Roth Contribution. The $361.82 is correctly reflected as after-tax since I was able to use the Roth 401(k) after-tax deduction option even though that goes into the same account as my pre-tax 401(k) contribution of $995. In my scenario, the only thing that I think would work is if Quicken allowed me to use the Roth 401(k) after-tax deduction 2x.

  • Jim_Harman
    Jim_Harman Quicken Windows Subscription SuperUser ✭✭✭✭✭

    Another thing you could do would be to leave the 3.65 out of the Paycheck wizard and let your paycheck be that much more than it actually was, then record the $3.65 as a separate transaction.

    QWin Premier subscription
  • q_lurker
    q_lurker Quicken Windows Subscription SuperUser ✭✭✭✭✭

    Fidelity requires 1% of your contributions to go into a separate account to pay for fees.

    Another thing you could do would be to leave the 3.65 out of the Paycheck wizard and let your paycheck be that much more than it actually was, then record the $3.65 as a separate transaction.

    What about recording the $3.65 1% within the paycheck transaction as a simple category expense, skipping the 1% "separate account". I assume the separate account gets zeroed out regularly as payments to Fidelity against some category.

  • BruceManno
    BruceManno Quicken Windows Subscription Member ✭✭

    Thank you all. I tried a few transactions based on your suggestions. At this point, the easiest thing to do would just to leave it as a reconciling item. Only good news here is that it's a small difference so won't impact my Tax Planner analysis too much. Thanks again.