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Subject Author Date
Transfering 401k t0 reg IRA Dick 12-26-2006
Posted by Dick on December 26, 2006, 8:54 pm
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 I have transferred my 401k holdings to a standard IRA. The transfer was
directly to the IRA. After entering the data into Q07 all seems ok except
that the total transfer is being considered as income in all the tax
planning reports. I have also taken my required withdrawals. These are also
added to my total income in the tax reports as they should be. Any ideas as
to what's going on???



Posted by John Pollard on December 26, 2006, 9:42 pm
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 Dick wrote:
> I have transferred my 401k holdings to a standard IRA.
> The transfer was directly to the IRA. After entering the
> data into Q07 all seems ok except that the total transfer
> is being considered as income in all the tax planning
> reports. I have also taken my required withdrawals. These
> are also added to my total income in the tax reports as
> they should be. Any ideas as to what's going on???

What transactions did you use to accomplish this "rollover"?

--
John Pollard
First initial underscore Last name at mchsi dot com
Please reply to newsgroup



Posted by Dick on December 27, 2006, 4:30 pm
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John,
The transaction I used in the 401k account was a SoldX with a transfer
to the new IRA account. The transaction was received by the IRA account as a
Contrbx. I then bought the shares in the IRA using the cash balance in that
account.
> Dick wrote:
>> I have transferred my 401k holdings to a standard IRA.
>> The transfer was directly to the IRA. After entering the
>> data into Q07 all seems ok except that the total transfer
>> is being considered as income in all the tax planning
>> reports. I have also taken my required withdrawals. These
>> are also added to my total income in the tax reports as
>> they should be. Any ideas as to what's going on???
>
> What transactions did you use to accomplish this "rollover"?
>
> --
> John Pollard
> First initial underscore Last name at mchsi dot com
> Please reply to newsgroup
>



Posted by John Pollard on December 27, 2006, 6:31 pm
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Dick wrote:

> The transaction I used in the 401k account was a
> SoldX with a transfer to the new IRA account. The
> transaction was received by the IRA account as a Contrbx.
> I then bought the shares in the IRA using the cash
> balance in that account.

Quicken doesn't have a "rollover" transaction (but I think it
could use one); it generally treats "transfers" out of
retirement accounts as your account "tax attributes" tell it to.
And frequently, transfers out of retirement accounts are
retirement "income". "SoldX" and "XOut" (and certain others)
seem to be fundamental "transfers" out of an investment account.

If you had never taken any "income" ("required withdrawals") out
of the 401k account for tax year 2006, I would have suggested
modifying your 401k account tax attributes to show no tax form
line for transfers out of the account ... then doing the SoldX
transaction.

I did a quick test in Q2006 (don't have Q2007).

If I transfer cash out of a retirement account with the
"transfer out" tax attribute assigned to a 1099 "income" Tax
Form Line, the transfer is treated as income (in the Tax
Schedule report).

But if I use a miscellaneous expense (MiscExp) transaction to
transfer the cash out, Quicken does not assign the transfer-out
to income in the Tax Schedule report.

So the transaction type you use to remove the cash from the
account seems to matter.

Two problems I don't have an answer for.

1.) MiscExp did not reduce the cash balance in the 401k account.
(I can't explain this at all).
2.) While the "transfer" did take place (the cash wound up in
the "rollover" IRA account); it was still considered a
"ContribX" in the rollover IRA account. I have no idea what the
ramifications of that are: I do not use TurboTax, for example.

Perhaps Q2007 does better.

--

John Pollard
First initial underscore Last name at mchsi dot com
Please reply to newsgroup



Posted by Dick on December 28, 2006, 4:56 pm
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John,
I don't understand how to do a MiscExp transaction. I can't find this
transaction anywhere. I may just have to live with this problem and wait to
see what happens when I transfer to Turbo Tax. I'll report back as to what
happens when I do it.
Sure would be nice if Quicken would handle this properly.
Dick
> Dick wrote:
>
>> The transaction I used in the 401k account was a
>> SoldX with a transfer to the new IRA account. The
>> transaction was received by the IRA account as a Contrbx.
>> I then bought the shares in the IRA using the cash
>> balance in that account.
>
> Quicken doesn't have a "rollover" transaction (but I think it could use
> one); it generally treats "transfers" out of retirement accounts as your
> account "tax attributes" tell it to. And frequently, transfers out of
> retirement accounts are retirement "income". "SoldX" and "XOut" (and
> certain others) seem to be fundamental "transfers" out of an investment
> account.
>
> If you had never taken any "income" ("required withdrawals") out of the
> 401k account for tax year 2006, I would have suggested modifying your 401k
> account tax attributes to show no tax form line for transfers out of the
> account ... then doing the SoldX transaction.
>
> I did a quick test in Q2006 (don't have Q2007).
>
> If I transfer cash out of a retirement account with the "transfer out" tax
> attribute assigned to a 1099 "income" Tax Form Line, the transfer is
> treated as income (in the Tax Schedule report).
>
> But if I use a miscellaneous expense (MiscExp) transaction to transfer the
> cash out, Quicken does not assign the transfer-out to income in the Tax
> Schedule report.
>
> So the transaction type you use to remove the cash from the account seems
> to matter.
>
> Two problems I don't have an answer for.
>
> 1.) MiscExp did not reduce the cash balance in the 401k account. (I can't
> explain this at all).
> 2.) While the "transfer" did take place (the cash wound up in the
> "rollover" IRA account); it was still considered a "ContribX" in the
> rollover IRA account. I have no idea what the ramifications of that are:
> I do not use TurboTax, for example.
>
> Perhaps Q2007 does better.
>
> --
>
> John Pollard
> First initial underscore Last name at mchsi dot com
> Please reply to newsgroup
>



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