If you track tax-related income and expenses in Quicken or import your TurboTax data, the Tax Planner may use the year-to-date amounts to calculate and prefill projected amounts for you. This process is called annualizing your data.
The Tax Planner offers two ways to annualize your data:
- Scheduled transactions (recommended): In this case, annualization is based on a projection of the amount in a scheduled transaction, such as federal income tax withheld from your paycheck.
- Estimate based on YTD daily average: In this case, annualization is based on the ratio of the number of days from January 1 until the current system date to a 365-day year. For example, if an item shows $10,000 earned through April 30 (approximately one-third of the year), annualizing this amount gives you a year-end income estimate of $30,000 (three times $10,000). On the other hand, if you earned $10,000 through April 30, but don't expect that income to continue at the same rate for the rest of the year, don't annualize that item.
Notes
Wherever possible, base your projections on scheduled transactions instead of annualizing year-to-date data.
- Click the Planning tab.
- Click the Tax Center button.
- Click Show Tax Planner.
- On the left side of the page, select the tax form or schedule containing the item you want to annualize.
- Show details, if necessary.
- In the Data Source area, select Quicken Data.
- Select Estimate based on YTD daily average.
- Tell me more
Quicken takes the current total for that item, projects it for the rest of the year, and uses the resulting amount in its tax estimates.
Some things to keep in mind:
- If possible, you may want to base your projection on scheduled transactions (the default method) instead. For example, if you track your paycheck using a scheduled bill or deposit, you can select Scheduled Transactions in the Quicken Data area, and the Tax Planner will base its projection on all scheduled instances of that bill or deposit. Note that scheduled bills and deposits are tracked by default, but only if they exist. If you create a scheduled bill or deposit after you've already begun to track your taxes with the Tax Planner, you need to go back into the Tax Planner and specifically select Scheduled Transactions as your data source.
- Quicken supports only two tax years (for Quicken 2017, the tax years are 2016 and 2017). You cannot annualize data from a year not supported by the Tax Planner.
- Employee stock option data, displayed in Wages and Salaries (Other), isn't annualized by Quicken.
This feature is not available in Canada.
