When you set up a security in Quicken it is possible to identify it as a bond and then further as a municipal bond. Municipal Bonds are almost always tax free income. When entering transactions for a given bond the income categories include Dividends and Interest. For Tax Free Income I always have to enter it as Miscellaneous Income and then further specify that it is investment income and then further as either tax free interest or tax free dividend. It has always puzzled me as to why I have go through this multi-choice method of entering the data rather than have all municipal income default to either Tax Free Interest or Tax Free Dividends. Any comments on this problem would be appreciated. I may have missed something along the way.
You can identify a security as "Tax Free"; for existing securities, select the security in the Security List and Edit - put a check in the "Tax Free" box. In most situations, Quicken will report the dividends and interest as tax free.
I ran a couple of tax reports and a couple of other reports (like the Income/Expense by Category report; and the Banking > Transaction) in Q2010 RPM, R3 (before I commented) and did not see the problem you report.
The tax reports excluded dividends and interest for Tax Free securitries (without my making any customizations).
I did see that there was no distinction in the Banking > Transaction report ... and (as I recall) other reports have always shown the "category" field as "_DivInc" or "IntInc", but when looking in reports such as the Income/Expense report, the amounts are reported under (what appears to be a pseudo-category ... though it is listed as an actual category) "_IntIncTaxFree or _DivIncTaxFree. When transaction details are available in reports, the category field shows as "_DivInc" and "_IntInc" but when subtotalled by category ... the main category name has the "_TaxFree" designation.
The Income/Expense by Category report correctly reported tax free interest in the "_IntIncTaxFree" "category".
When I look in the Tax Schedule report in Q2010, I do not see any tax free interest or tax free dividends (which I assume is correct) ... despite the fact that those "categories" are selected in the Customize dialog and the accounts that hold those tax free securities are selected to include in the report.
I don't understand why a report, subtotalled by Category, would show the heading of the category as "_IntIncTaxFree" while showing the Category field as "_IntInc". That's why I hedged my previous comment in this thread ... I don't fully understand what Quicken is doing with tax free securities.
My thanks to all who responded to my query on tax free income. It confirms pretty much what I have experienced all previous versions of Quicken. I am going to continue working with the suggestions given in the coming year and keep doing what I have been for the time being. It is really laborious and seems like it should be a rather simple software solution. I don't understand why Quicken hasn't addressed this problem fully in the past. Thanks again and I think we will revisit the issue after the beginning of next year.
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here.
All logos and trade names are the property of their respective owners.