Where do i enter 1099-R (code P) when amending a prior year tax return?

Forum|Forum|7 years ago
June 5, 2019
1 reply
0 views

2nd attempt at this q.. TT deleted/archived my previous submission

I had excess contribution to my 401K in 2017, which was refunded to me in January of last year but I was incorrectly told this would be taxable income in 2018 so I did not add to my 2017 return. Received a 2018 1099-R (code P) this year. I have generated a "amended" copy of the return in TT to edit it.

Q is how to enter this income on amended 2017 tax return. In retirement section>1099-R>clicked yes on did you have any rollover, withdrawal in 2017>when entering the details, code P is for taxable income in 2016. So, do I enter the refund of excess to my W2 income? If yes, which employer since I changed jobs in 2017 - so employer on Dec 31, 2017? or file this with code 8? or after entering with code P, somewhere TT will clarify and make sure it applies to 2017 income?

Also, does this income need to be reflected in 2018 return?

Thanks!

TurboTax Deluxe Windows

Best answer by macuser_22

A 2018 1099-R with a code "P" in box 7 is taxable in 2017, the year the contribution was made, not 2018.

You must amend 2017 to report it. The 2017 1099-R interview will say that code P means "Return of contribution taxable in 2016", but the interview will ask if this it a 2017 1099-R or a 2018 1099-R. Say 2018 and the "taxable in 2016" becomes "taxable in 2017" (the year advances by 1 each year).

It is not reported in 2018 unless there were earnings in which case the earnings should be reported on a separate 2018 1099-R with a code 8 on box 7 to be reported in the year the earnings were returned.

macuser_22

Answer

Alumni - Champ

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**

aa2Author

Level 2

Thank you! I will try that (ETA: That worked!). Will there be a penalty/interest due on the tax I now owe as a result of this amendment?

So, in 2018 tax return, it (code P info) does not need to be added even as FYI? (I am adding 2018 1099-R code 8 in 2018 return.)

Another related question: As a result of tax law changes reducing our deductions for property tax/SALT combo and this additional tax owed in 2017, our tax withholding for 2018 MAY not be enough resulting in penalty. Without this amendment, we were ok. But after the amendment, with increased 2017 tax, we may not be (I still have to calculate). Will TT be able to address this now and tell us if we owe a penalty/interest given that I started the 2018 return before starting the 2017 amendment in TT and it did not carry over all the information from amended return? What if I add the 1099-R income with code P in 2018 return My concern is that we may find out 4 years from now and interest will keep accumulating between now and then. I would rather pay couple hundred dollars in penalty now than let it balloon to thousands. Thanks!