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Manually override calculated contribution to tax-deferred (after tax) account?

 

NC Cpl
(@nc-cpl)
Eminent Member Customer
Joined: 2 months ago
Posts: 26
Topic starter  

I'm using the Personal Contribution to Tax-Deferred Accounts (Pre-Tax) to designate my annual amount contributed to my 401k. I'm using the Personal Contribution to Tax-Deferred Accounts (After Tax) for my non-deductible contributions to my TIRA. The challenge I'm encountering is that if I shorten my employment from a full year to something shorter (say I retire at the end of the first quarter next year), I see these amounts being reduced to reflect a shorter employment year. BUT, I always make my full TIRA contribution of $7k at the start of the year, so I want it to reflect that rather than reduce it based on a partial employment year. The 401k I'm ok to leave as a "calculated" amount.


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Stuart Matthews
(@smatthews51)
Member Admin
Joined: 12 months ago
Posts: 215
 

My recommendation would be to use another of the employment income streams and specify only the personal contributions (with no corresponding income). On this stream, you can make this a lump sum by setting the start and end the same. The full amount of the contribution will then be treated as an expense for that year.


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NC Cpl
(@nc-cpl)
Eminent Member Customer
Joined: 2 months ago
Posts: 26
Topic starter  

Did that but its reducing my $7k after-tax contribution down to $6641 for each of us?

@smatthews51

This post was modified 2 months ago by Stuart Matthews

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Stuart Matthews
(@smatthews51)
Member Admin
Joined: 12 months ago
Posts: 215
 

@nc-cpl I suspect that you didn't specify an Annual Increase % for that income stream (it should probably be set at the inflation rate).


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NC Cpl
(@nc-cpl)
Eminent Member Customer
Joined: 2 months ago
Posts: 26
Topic starter  

That doesn't feel like an optimal fix for an after-tax IRA contribution, because now I have to specify the amount artificially low ($6188 instead of $7000) and factor in a 3% increase just to get it back to $7000 in the Tabular sheet. I'm understandably hesitant to "manipulate" any entry to get them to show correctly in the sheet, as over time I may forget the rationale for why it was done that way.

Does the "date at which full time employment cease" cell affect entries in the other income streams (2 and 3), or are the completely independent of that stream and cell? Even though my wife has stopped working, I still plan to make a $7k after tax contribution for her next year, but if I set it up in Stream #2, it doesn't show up in the Tabular view.


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Stuart Matthews
(@smatthews51)
Member Admin
Joined: 12 months ago
Posts: 215
 

@nc-cpl What I suggested isn't a "fix"; it's the way the tool works. Everything about a given income stream is inflated at the rate of increase specified by the user for that income stream. You should not have to specify anything artificially low. There's something else going on if the tabular projection is showing something other than what you expect. Feel free to send me an export file if you want me to investigate.

The "date at which full time employment will cease" affects all increase streams IF (AND ONLY IF) you associate the start or stop of an income stream with that date by typing an "R" in the start/stop field (as clearly described in the manual). Again, if you think the tool might be at fault, feel free to send me an export file and I'll be happy to investigate.


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