@gulsheenk wrote:
@Opus 17 @LindaS5247 : I have a follow up question to this regarding my rollover from previous employer to my IRA accounts. I had the following transactions:
1.) Roth 401K funds transferred to Roth IRA account - received 1099 with distribution code G
2.) Non-Roth 401K funds transferred to Rollover IRA Account - received 1099 with distribution code H
Questions:
i) All of these 1099 forms have some funds in box 5 " Employee contrib/desig Roth contrib or insurance premiums. Where is this amount coming from? I've called Fidelity a couple of times and they are unable to tell me and asked me to check with a CPA. Wondering if one of you can guide?
ii) I received another 1099 with distribution code 1B; I am still trying to figure out what this is considering I have not withdrawn any fund. Any guidance on how I can decipher this amount of $82.99 in box 5 (rest of the form is blank)?
Thanks!
Check your forms again.
1.) Roth 401K funds transferred to Roth IRA account - received 1099 with distribution code G
This is the wrong code, this type of transaction should be reported with code H.
2.) Non-Roth 401K funds transferred to Rollover IRA Account - received 1099 with distribution code H
Wrong code, this should be reported with code G.
I'm not familiar with box 5, this is what the IRS instructions say.
Box 5. Employee Contributions/Designated Roth Contributions or Insurance Premiums
Enter the employee's contributions, designated Roth contributions, or insurance premiums that the employee may recover tax free this year (even if they exceed the box 1 amount). The entry in box 5 may include any of the following: (a) designated Roth contributions or contributions actually made on behalf of the employee over the years under the plan that were required to be included in the income of the employee when contributed (after-tax contributions), (b) contributions made by the employer but considered to have been contributed by the employee under section 72(f), (c) the accumulated cost of premiums paid for life insurance protection taxable to the employee in previous years and in the current year under Regulations section 1.72-16 (cost of current life insurance protection) (only if the life insurance contract itself is distributed), and (d) premiums paid on commercial annuities. Do not include any DVECs, any elective deferrals, or any contribution to a retirement plan that was not an after-tax contribution.
Generally, for qualified plans, section 403(b) plans, and nonqualified commercial annuities, enter in box 5 the employee contributions or insurance premiums recovered tax free during the year based on the method you used to determine the taxable amount to be entered in box 2a. On a separate Form 1099-R, include the portion of the employee's basis that has been distributed from a designated Roth account. See the Examples in the instructions for box 2a, earlier.
That probably explains the separate 1099-R. But this rest is cloudy to me too. Did you ever make excess contributions to the 401k, or had your contributions declared excess because the plan failed its non-discrimination testing?
I will ask a smarter expert, @dmertz
