Need clarification for split entry...

willi1

Windows Canada R26.18 Classic Deluxe

I have been entering my RRIF income entry from the bank deposit mid month and it has worked with these entries.

Now I'm not sure why I needed Line 4 other than to zero out the split. Original deposit to chequing account was 1747.00. Any thoughts on what I thought I was doing???? 🙄 Weird, I know…but…think I'm getting too old….

CaliQkn

@willi1 - it looks like you are attempting to assign a category (RRIF Income) to a transfer transaction. The last item #4 is a transfer out of the checking account (self-transfer) as an offset to the category (RRIF Income) amount.

willi1

I can't seem to get my head around this. Isn't the entry in the register before I split it, the entry that would constitute the entry to the bank? I'm certainly no accountant…not even a bad bookkeeper but this has 'worked' for me previously in terms of my budgets etc., when I stop and actually look at it, it seems wrong. Is it? Does it have something to do with it being a 'transfer'. Sheesh, I don't even know the right questions to ask.

CaliQkn

@willi1 if it works for you then it's perfectly fine.

Yes, your "extra transactions" in your split have to do with the linked transfer.

Linked transfers do not have a category. They simply show money movement from one account to another.

To get around this limitation it is possible to "add" a category to the linked transfer by adding a split transaction with the category and an offset linked transfer transaction back into the account (to balance).

It works because when you run reports, the two linked transfer transactions (the actual transfer and the offset transfer) net to zero. What you are left with is the amount attached to the category.

The only ramification is you have multiple transactions for each transfer.

Hopefully this all makes sense.

NotACPA

Have you set the Tax Attribute for the RJ RRIF Managed account so that transfers out are assigned a Tax Line?

If not, you need to do so, which will eliminate the need for both your 3rd and 4th lines of the split.

Then, recording this txn in your chequing account will cause a deposit there of $1,747.

willi1

NotACPA…I see a listing for RRSP Income, I don't see a listing for RRIF Income…does it really matter?

Thanks!

CaliQkn

@willi1 I will jump in here, hopefully @NotACPA won't mind.

RRSP and RRIF are two separate accounts but related. An RRSP converts to a RRIF once withdrawals commence. I think "RRSP Income" refers to the pre-tax contributions made to an RRSP. I think your category "RRIF Income" refers to the withdrawals from the RRIF deposited to your checking account.

Do you use reports from Quicken for tax preparation? If so, do they work for you? I would say that if they do, then just keep things as they are. The tax codes on Quicken are sometimes "iffy", and even if they are used, they don't help much. Sometimes just having the an accurate category helps more with tax preparation.

But if you are looking to change your current process, we would be happy to help.

willi1

thank you…I think because of how I function, I'll skip the tax id and just proceed as I have been…as in 'don't rock the boat' particularly when you don't really know what you're doing. Thanks for your time in trying to help me, and you too @NotACPA 😁

NotACPA

@Will1 Since I'm in the US, I really have almost no concept of CDN tax laws … other than knowing that they're different that in the US.

But transfers out of a tax-deferred account (which I THINK your RRIF is) can be assigned a tax line from within Q, which makes a transfer record as a taxable event.

BUT, whatever works for you is all that Q needs.

Best of luck.

Arctic Hare

@willi1 Put simply and concisely… Line #4 is required because $1,747 worth of income has been double entered - once as part of line #1 and a second time as line #3. That is, you have recorded a total of $,622.79 ($1,857.79 + $1,747.00) of income. Line #4 is need to zero out the double entry of income. You should delete lines #3 and #4 as they effectively cancel one another out.

OK, so we've got rid of the double entry of income, but next you are going to ask, how do I track the taxable income from the RRIF… well, @NotACPA answered that question when he asked, "Have you set the Tax Attribute for the RJ RRIF Managed account so that transfers out are assigned a Tax Line?"

The concept that you are missing is that the "income" happened in Line #1 and you need to use the tax line feature to recognize that income. Line #3 causes the double accounting problem. You are trying to use a "Category" to track the income, but the proper method - as @NotACPA indicated - is to use the tax line feature.

You've come up with a bit of a workaround that does get the the right amount of income mapped to a category, but it is not the appropriate way of handline the transaction - and, as you indicate yourself, it is confusing you.

Keep in mind, the increase in your Net Worth happened within the RRIF itself, not when funds were transferred from the RRIF to the chequing account. Your Line #3 effectively increases your next worth, so then you have to cancel that false increase out using LIne #4. When you transfer funds from the RRIF to the chequing account, what you need to do is recognize those funds as taxable income and that is done using the tax line feature. Categories should only be used for transactions between the world outside your quicken accounts and your quicken accounts. If your RRIF account is included in your Quicken file, then you can't use a category to properly recognize the income.

willi1

oh my…thank you so much for trying to help me with this, but I just don't get it.

At this point, I’m not using Quicken for tax purposes—I pay someone to handle that. What I’ve been trying to figure out in all of this is: when the RRIF transfer is posted to my chequing account, how can I get that amount to show up as RRIF Income in the Income section of my Budget?

If I delete lines 3 and 4 (as previously suggested), won’t that leave me with no RRIF Income showing in my current budget?

I’ve tried to understand the tax-related setup, but most of the references seem geared toward U.S. products, which just adds to my confusion. (It’s hard to admit when something’s over your head 😔)

The bottom line is, since I no longer manage my investments or file my own taxes, I’m simply trying to get the RRIF Income to appear correctly in my budget.

Again, many thanks for your patience and wisdom. I really appreciate it.

CaliQkn

@willi1 if you don't use Quicken for tax preparation, then tax coding or tax categories is a moot point.

Is the RRIF Income not appearing correctly in your budget? It should be showing as income or transfer in, in your budget.

Arctic Hare

https://community.quicken.com/discussion/comment/20487701#Comment_20487701

@willi1 Transfers In are excluded from the budget by default, but you can include them. Here is where you can include the Transfer In from a specific Account in your budget - click on the "Manage Budget Categories" button:

Include the Transfer In From the RRIF Account here and delete Lines #3 and #4 in the split transaction and don't fuss about the tax line mapping.

willi1

@Arctic Hare Are you saying that simply checking off the Transfer In from RJ RRIF account would then show this entry as Income? How would it know to use RRIF Income?

Extra Info…I have rerun Dec 2024 Budget (entered the old way I used to do it and RRIF Income is there.)I proceeded to re-run Jan 2025. I ticked off as noted above and simply showed a transfer of the net amount (I left out the taxes at this stage) and RRIF Income is not on Budget for Jan 2025. I simply showed as transfer from RJ-RRIF Managed to Personal Chequing…one amount. I also closed Quicken and re-opened, and validated the file. Same same…so frustrated…you might read about an old babe in White Rock, BC that jumped because of Quicken…that would be me 😩

Arctic Hare

https://community.quicken.com/discussion/comment/20487724#Comment_20487724

If I check the Transfer In From xx-account in the dialogue box shown above, it immediately adds a From that account line to the Personal Income section of the Budget. I then created a Transfer Cash Out transaction from the investment account added above and then I can see that amount show up in the Actuals in the Budget compare budget to actuals view… demonstrating that this works. Without being able to see exactly what you are doing, it is not obvious why it doesn't work for you, but the reporting and budgeting you seem to be seeking works smoothly for me. For my test, I transfered 1,000 from a TFSA to my chequing account in March. See the screenshot below (with any non-relevant, private information redacted):

That is what you want, isn't it?

willi1

@Arctic Hare

Lesson Learned – Customize Current Budget REPORT (Quicken for Canada)

Oh goodness… feeling humbled and a little dejected, but determined—and hoping this might help some other poor soul!

I should have clarified that I was working with the Current Budget Report, not just the Planning tab. I ran a test by recording a $15.00 transfer from RJ-RRIF Managed to my Personal Chequing account. As expected, the $15.00 showed up under Planning > Actuals.

However, when I ran the Current Budget Report (Week to Date), no RRIF Income category appeared. I double-checked “Customize” and confirmed that RJ-RRIF Managed was included in the account selection.

At this point, I suspected there might be something else in play—possibly in the Advanced tab under “Customize Current Budget.” I had never needed to use those settings before.

Sure enough, the solution was in the Transfers setting. Once I changed it from “Exclude internal” to “Include all”, the income appeared in the Budget Report—though it now showed as “FROM RJ-RRIF” rather than under the RRIF Income category. (I realize now this was what you were trying to explain to me earlier—thank you, and sorry it went over my head at the time!)

With that sorted, I tried to integrate Withheld Taxes into the deposit-side entry of the transfer, hoping I could automate the entire monthly RRIF process. Unfortunately, I couldn’t get that part to work as expected—likely due to all the layers of understanding still settling in.

So for now, I’ll just make a manual entry for the tax withholding in the RRIF Managed account each month. It’s probably the simplest path forward.

Once again, thank you, thank you, thank you for being so patient in helping me sort this out.

Arctic Hare

The witholding tax part should work by creating a transfer that has a value of your NET income (total RRIF annuity less witholding tax, but, in the split, the transfer from the RRIF is the GROSS amount and then use the appropriate tax category to expense the Withholding Tax.