IRA Withdrawal not in Tax report

ozarkcanoer
ozarkcanoer Member ✭✭
edited May 2022 in Investing (Mac)
I had a IRA withdrawal from one IRA account for a conversion to a Roth IRA and it was transfered to the Roth Account.  In the IRA account the transaction is a Payment/Deposit with IRA Withdrawal as the Category.  I check in the Categories list and it is in the 1099-R list as a taxable income transaction.  The transferred transaction appears on the Roth IRA account. When I have QMac 2017 create a Tax Report the converted amount does not appear under 1099-R section. Thinking I must have made some simple error in the transaction.  Same issue in QMac 2016.  How can I go about correcting this?

Comments

  • J_Mike
    J_Mike SuperUser ✭✭✭✭✭
    edited October 2018
    The issue for your case is that both the source account and the destination account are tax-deferred and, as such, are not included in the tax report. You can check the customize dialog of the report to verify this.

    I would suggest a work -around for this issue. Create a temporary holding account - a simple Cash Account will do. The Cash account will be a taxable account by default.
    Route the funds thru the cash account; i.e., transfer from Trad IRA to Cash and then from Cash to Roth IRA.
    Use the IRA Withdrawal category for the transfer from the Trad IRA to Cash.
    Do not assign a category to the transfer from Cash to Roth.

    Note also; the category must be assigned a tax line item - 1099-R:Total IRA taxable distrib.

    Now check the Tax Schedule Report - you should see the distribution reported under the 1099-R header.

    You did not mention this but are there any tax withholdings involved here? If there are, the withholdings would be recorded in the Cash account.
    Transfer the gross distribution from the Trad IRA to Cash.
    Record any Fed/State taxes withheld in the Cash account - negative amounts subtracting from the gross distribution.
    Transfer the net distribution (what's left) from Cash account to the Roth IRA.
    QWin & QMac (Deluxe) Subscription
    Quicken user since 1991

  • ozarkcanoer
    ozarkcanoer Member ✭✭
    edited October 2018
    Ok, but seems like Quicken Mac ought to be able to deal with this very common events like a IRA withdrawal which is taxable when the money goes into a taxable account or into a non-taxable Roth IRA.  Guess I need to ask for a new feature?
    thanks,
  • J_Mike
    J_Mike SuperUser ✭✭✭✭✭
    edited December 2016
    ozarkcanoer said:

    Ok, but seems like Quicken Mac ought to be able to deal with this very common events like a IRA withdrawal which is taxable when the money goes into a taxable account or into a non-taxable Roth IRA.  Guess I need to ask for a new feature?
    thanks,

    QMac handles distributions to taxable accounts quite easily.
    It's the conversion from one tyoe of tax-deferred account to another type of tax-deferred account where complications arise.
    FWIW, QWin versions have similar issues - has been that way since tax-deferred accounts were introduced.
    QWin & QMac (Deluxe) Subscription
    Quicken user since 1991

  • ozarkcanoer
    ozarkcanoer Member ✭✭
    edited December 2016
    ozarkcanoer said:

    Ok, but seems like Quicken Mac ought to be able to deal with this very common events like a IRA withdrawal which is taxable when the money goes into a taxable account or into a non-taxable Roth IRA.  Guess I need to ask for a new feature?
    thanks,

    JM, you've twice provided guidance on how to deal with Quicken Mac shortcomings in dealing with IRA Withdrawals: (1) RMD withdrawals where there might also be withholding tax payments to IRS and State as well as the total withdrawal and (2) a IRA to Roth IRA conversion where the withdrawal amount doesn't go to a taxable account but from the tax deferred IRA to the nontaxed Roth IRA but the total transferred amount is taxed.
    Thanks - I'm going to see if I can create a IDEA for getting Quicken devlopment to create a wizard for both types of withdrawals so us users don't have to do tricky transactions.
  • ozarkcanoer
    ozarkcanoer Member ✭✭
    edited December 2016
    ozarkcanoer said:

    Ok, but seems like Quicken Mac ought to be able to deal with this very common events like a IRA withdrawal which is taxable when the money goes into a taxable account or into a non-taxable Roth IRA.  Guess I need to ask for a new feature?
    thanks,

    I've added an IDEA for Quicken Mac to handle the two types of IRA withdrawal transactions I need to do; Please vote for it if you agree: https://getsatisfaction.com/quickencommunity/topics/quicken-for-mac-2017-needs-a-wizard-to-handle-tw...
  • ColleenTonolliMusselman
    ColleenTonolliMusselman Member ✭
    edited January 2018
    JM said:

    The issue for your case is that both the source account and the destination account are tax-deferred and, as such, are not included in the tax report. You can check the customize dialog of the report to verify this.

    I would suggest a work -around for this issue. Create a temporary holding account - a simple Cash Account will do. The Cash account will be a taxable account by default.
    Route the funds thru the cash account; i.e., transfer from Trad IRA to Cash and then from Cash to Roth IRA.
    Use the IRA Withdrawal category for the transfer from the Trad IRA to Cash.
    Do not assign a category to the transfer from Cash to Roth.

    Note also; the category must be assigned a tax line item - 1099-R:Total IRA taxable distrib.

    Now check the Tax Schedule Report - you should see the distribution reported under the 1099-R header.

    You did not mention this but are there any tax withholdings involved here? If there are, the withholdings would be recorded in the Cash account.
    Transfer the gross distribution from the Trad IRA to Cash.
    Record any Fed/State taxes withheld in the Cash account - negative amounts subtracting from the gross distribution.
    Transfer the net distribution (what's left) from Cash account to the Roth IRA.

    Thank you --- the method you suggested worked for me today. I appreciate very much your concise instructions in this workaround.
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