I'm not aware of any downside to what you propose.

"Bob Becnel" <rgb2[at]hilton.cec.wustl.edu> wrote in message
news:Pine.GSO.4.58.0309181730550.17346[at]hilton.cec.wustl.edu...
- quote -

Along these lines, I don't know what my employer match is until my
quarterly statement comes out and then I only know it for the cumulative
of 3 months. I suppose I could divide this by 3 and assume it it is
exactly 1/3 each month.

However, is there a down side to just entering a lump sum in my 401k cash
account and marking it "wages: employer matching" versus showing it on
each paycheck detail for the past 3 months?

I was curious if this would affect budgeting or taxes anywhere?

Bob


On Thu, 18 Sep 2003, ddutch wrote:

- quote -

Gotcha. You just explained exactly what I needed to know.
I'll use the method described in the FAQ

Thanks for your help

Ddutch
- quote -

22+group:microsoft.public.money+author:dick+author :watson&h
l=en&lr=&ie=UTF-8&oe=UTF-8&selm=upAIp%24LjAHA.1844%
40tkmsftngp05&rnum=2
- quote -

Here's the deal:

What you propose will certainly hose you up in the tax estimator since it
will surely show your taxable income as including the employer contribution
and credit nothing against this so it will have you paying taxes on this
(tax-deferred) money. Bad thing. (If you use tax estimator.)

The tax estimator works by reducing the contents of the first entry on the
Wages tab by subtracting everything on the before taxes tab then adding
every other line on the wages tab--that was set by category to be included
in the W2 taxable--and calling the result your taxable wage income.

So, you say, why not set this up as follows?
Wages tab: +$x Gross Pay:Employer Matching
Before-tax tab: -$x Transfer:[401k match]
net: $0

These **should** offset, but here's how the tax estimator really works (or
worked the last time I looked into this):
Wages tab (first line): $z Wages:Gross
Wages tab: +$x1 Gross Pay:Employer Matching (a category set to not report
on W2)
Before-tax tab: -$x2 Transfer:[401k match]
(where x1 = x2)
net: $z,
taxable wages used by tax estimator: $z-$x2 (but not $z-$x2+$x1 since w1 was
categorized to not go in W2 income)

This lowers your taxable used in the tax estimator by the amount of the
employer contribution. Bad thing. (If you use tax estimator.)

Here's the original posting:
http://groups.google.com/groups?q=+%...ftngp05&rnum=2

"ddutch" <doedeeg[at]wyeth.com> wrote in message
news:0f9a01c37df8$a9e78670$a401280a[at]phx.gbl...
- quote -

If you enter their contribution twice--once on each of wages and after-tax
tabs, you double it and end up with extra money that you really don't have.
Note that the FAQ method exactly offsets the income with the transfer to the
401k so the net added to the paycheck is $0. You don't describe how you deal
with the $s added on the wages tab.

FAQ Method:
After-tax tab: +$x Gross Pay:Employer Matching, -$x Transfer:[401k match]
net: $0

Your method (extrapolated):
Wages tab: +$x Gross Pay:Employer Matching After-tax tab: +$x Gross
Pay:Employer Matching, -$x Transfer:[401k match]
net: $x

"ddutch" <doedeeg[at]wyeth.com> wrote in message
news:0d7301c37de7$3a9cd560$a401280a[at]phx.gbl...
- quote -

The FAQ has the following information regarding entering
employer contributions:

"The more elaborate way that gets the contributions tied
to your paycheck--assuming that your plan matches on a pay
period basis--but doesn't hose up the Tax Planner is to
enter an income entry on the After Taxes tab (use a
negative number--trust me on this) against the "Gross
Pay:Employer Matching" or similar, tax-neutral, category.
Then do a Transfer of the same amount to the 401(k)
contributions account on the next line of the split."

My question: Why shouldn't you enter the employer
contribution on the Wages tab first, and then again on the
After Taxes tab? What's the difference between the method
in the FAQ and what I suggested. Will my suggested method
(enter on 2 separate tabs) mess up the budget and/or the
tax planner?

Any feedback is appreciated.

Ddutch