Money does not file your tax return for you. Notifying money of the tax
differences doesn't get you very far. Let your tax program handle your tax.
At year end you will receive 1099s. Enter those info into your tax program
and you are done.

"Richard Schulman" <raschulman-xyz[at]optonline.net> wrote in message
news:3ijtt0p1gte8aqincd3dkesl21e3oevov2[at]4ax.com...
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In microsoft.public.money, Richard Schulman wrote:

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I suspect those are the same. I would expect the financial service
company to list some "Non-qualified Dividends" if that comes up. In
the case of the mutual fund company, I don't know if they will have
a special designation for non-qual, or if they group these in with
interest payouts.

This table may be of use as an example:
http://personal.fidelity.com/plannin...l.cvsr?refhp=c


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No. The federal tax is normally larger than the state tax, and the
true net effect will be closer to entering them as taxable.

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No. In both cases the money is federally taxed, but not state taxed.
An exception is that sometime a fund will have some income that is
not actually treasury interest, even tho that is the focus of the
fund. Your fund prospectus will probably point that out.

I don't think Money has such an activity, and it does not estimate
state taxes.

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I don't think so, but misc.taxes.moderated would get you a better
answer.

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See item 3 above.

I think Money is a really good way to prepare your schedule D
transaction information for actually feeding that data directly to
your tax program. For other tax things, such as dividend items you
discuss above, I look at Money as a way to estimate and to sanity
check the 1099 data. The 1099 data may differ from what you have
entered in Money. A common example is for a REIT or fund that
contains some REITs, the dividends are non-qualified. However some
money that is distributed is really return of capital, and some is
capital gains. While it is possible to read the reports of the REIT
and enter separate ReturnOfCapital, LTCG, STCG and the bulk as
OtherIncome, I just enter the whole distribution as OtherIncome.
Then I wait for the 1099s to actually get the data to the tax
program. In fact, it is fairly common for the 1099 that your broker
issues at the end of January is followed by a corrected 1099. So I
will wait to send in the return until after most of the potential
for a change has past.

The REIT distributions I would term Other Income, which will give a
slightly over-pessimistic on your actual ultimate tax liability.

Others may well have their own methods.

The question you pose are all beyond the level at which Money "knows" the
difference. I.e., the Tax Estimator, et al., don't know about these finer
points of tax law. For instance, there is a difference in tax treatment of
qualified and ordinary dividends. While you might be able to fake Money into
recording the difference, it wouldn't do anything with it. The only possible
gain even if you did coerce Money into knowing the difference would be in
the data you could use to do the tax prep work. For that, I wouldn't depend
on data collected in Money but would go straight to all of the tax
statements from brokers/mutual fund companies, etc.

"Richard Schulman" <raschulman-xyz[at]optonline.net> wrote in message
news:3ijtt0p1gte8aqincd3dkesl21e3oevov2[at]4ax.com...
- quote -

I have some tax questions pertaining to MS Money:

1. In monthly statements I receive from my financial service company,
stock dividends are described as "Qualified Dividends" but mutual fund
and ETF dividends are described as "Taxable Dividends." Do these
designations indicate a difference in how they will be taxed and if
so, how do I let MS Money know which kind of dividend I am entering?

2. Should securities that have a partial tax exemption -- e.g., U.S.
Treasuries -- be entered as "Tax Exempt"?

3. Is there a difference in the tax treatment of U.S. Treasury
interest when the securities are held directly vs. when the interest
is paid out as dividends from a mutual fund consisting entirely of
Treasuries? If so, how does one let Money know about this difference?

4. Are TIPS treated differently from a tax standpoint than non-TIPS
Treasuries? Is the tax treatment different depending on whether the
TIPS are held directly or through a mutual fund? How does one notify
MS Money of these differences, if they exist?

(I have MS Money 2004 Standard.)


Richard Schulman (for email reply, remove the "-xyz" part)