Discrepancy between 1040-X and 1040-SR

[ewandnl]

I started an amended return, adding one 1099-R income ($15,904, with fed tax of 5%). My original return showed a refund of $2943 and the 1040-X shows I owe $2748. The 1040-SR form in the amended return shows a refund of $195. This is very confusing.

[KrisD15]

Sounds to me that the 1099-R is generating 5% tax AND ALSO the 10% penalty tax. 

Was this an early withdrawal?

Was there Federal tax withheld on this 1099-R?

Did you get the Recovery Rebate Credit (stimulus payments) on the original return? 

Are you sure it did not go from OWING 2,943 to owing 2,748? That would be a difference of 195. 

[ewandnl]

Thanks for your reply.

The 5% federal tax was set up by me in the pension as part of monthly distributions. This was not an early withdrawal. I did report the Recovery Rebate payments on the original filing. I triple checked and the 2943 was a refund. I can see where the discrepancy is taking place but do not understand the logic. The worksheet shows my previous over payment on line 18 (2943). That gets subtracted from line 17 (8009, the new total income tax paid). Then that value, line 19 (5066) is subtracted from the new total income tax paid (line 17). The difference is 2748, the amount I owe. This just seems flaky to me. On the 1040-SR the values used are the same but instead of owing 2748, I am owed a 195 refund. The difference is the extra subtractions on the 1040-X. I just find it hard to swallow such a huge difference in results over 15,900. with 5% federal tax already taken out.

[DawnC]

Take the taxable amount of your distribution on your 1099-R and multiply it by your marginal tax rate.   That is the amount of ordinary income tax you on the distribution.   Whatever you had withheld (5%, 10%, 20%, or nothing) gets applied on Line 25 of Form 1040.  

[ewandnl]

Thank you DawnC.  The tax on the taxable amount was already applied per the 1099-R.

[ewandnl]

I decided to submit the amended return as is (paid the $2748) and let the IRS decide if there is an issue with the math. After I submitted I used the Turbo Tax analysis tool and it commented that I had a $195 refund coming and made suggestions for this tax year. Go figure-literally!