1099-R Rollover - Distribution Code G - Showing a Taxable Amount

Forum|Forum|2 years ago
February 16, 2024
3 replies
177 views

Good day,

I received a 1099-R form for with the following selected ; XXXX Gross Distribution & Taxable Amount being the same, Total Distribution Selected, and a Distribution of Code of G.

This creates a large tax liability which again I feel is made in error. I placed a direct rollover to my new institution which, was made directly to them in FBO of my name.

I believe a distribution code of G is a non taxable event is that correct?

I have already emailed and spoke to the previous institution and they are giving me a hard time about sending a correction to the 1099-R.

VolvoGirl

Level 15

Yes code G is a direct transfer and not taxable. What kind of account did you put it in? Was it to a ROTH? Go back and delete the 1099R and enter it again manually. You must have answered a follow up question wrong. Did you check the actual 1040 return? Line 4b or 5b should be 0 and say Rollover by it. If you are just looking at a review or summary screen it will show it all as income so you have to check the actual return.

Before filing you can preview the 1040 or print the whole return
https://ttlc.intuit.com/community/accessing/help/how-do-i-preview-my-turbotax-online-return-before-filing/00/26160

dmertz

Level 15

This code-G Form 1099-R implies that you told the plan to roll the distribution from the traditional account in your 401(k) directly to the designated Roth account in the same plan (apparently not the case here since the money went to a different financial institution) or to a Roth IRA. Such direct rollovers are taxable. If you told the plan to make the rollover to a traditional IRA or to the traditional account in another employer's plan and actually deposited the funds into one of these types of traditional accounts, the plan needs to correct the Form 1099-R to remove the taxable amount.

If you told the plan to do a rollover to a Roth account but instead deposited the money into a traditional account, the Form 1099-R will not reflect that you diverted the funds to a traditional account. Since that's not an error made by the plan, they won't modify the Form 1099-R. Instead you'll need to create a substitute Form 1099-R (Form 4852) in TurboTax where you can explain to the IRS what you did to divert the funds.

VolvoGirl

Level 15

@dmertz Did you post this on the wrong question? Like this one?

https://ttlc.intuit.com/community/taxes/discussion/how-do-i-report-converting-money-from-traditional-ira-pre-tax-to-roth-ira-in-turbotax/00/3194693

dmertz

Level 15

Direct rollovers reported with code G in box 7 can be either nontaxable or taxable depending on the type of account that receives the rollover. A taxable amount in box 2a of a code G Form 1099-R reports a taxable rollover from a traditional account in the plan to some kind of Roth account.

MarilynG

Level 15

No, you don't need to delete your 1099-R entry, but you may want to double-check your entries (and the follow up questions). Your Code G indicates the distribution as non-taxable, so there is something else triggering the taxability. Is there a second code on your 1099-R?

If you're using TurboTax Online, you could close the program, clear your Cache and Cookies, re-open (maybe try a different browser), and return to the 1099-R section.

You won't need to prepare any forms yourself; TurboTax will prepare them if needed.

Here's more info on How to Enter 1099-R and Box 7 Codes on Form 1099-R.

@MikeM-Denver

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MikeM-Denver

Level 2

MarilynG1,

There are no other codes on the form. 1.= gross dist which is full amount of 401k transfer. 2.= 0.00 taxable amount. IRA/SEP/Simple box is blank so question 1 is NO, Rollover from 401k to Roth =NO, Was this money rolled over to Roth IRA =- NO, Safety Officer = NO, Qualified disaster = NO..

That's how all is entered. I downloaded Turbo on my PC and am running it from there. Also click download updates when opening. Really think this is screwing my income up. Mike

MikeM-Denver

Level 2

MarilynG1,

So I decided to delete the 1099-R in question and my FED refund did not change. So besides the Turbo Summary showing this as income it did not affect my running refund. Interesting. So ignore and move on?