SFsarge
Returning Member

move money from a 401K to a Roth IRA

I am converting $45K from my 401 to a Roth IRA. I am paying the tax (about $9200) out of my bank account. Turbo tax won't let me convert 45K. I get an error because Turbo Tax wants the total converstion to be $45K. Turbo tax adds the 9200 to the 45K and errors because the amount exceeds the total conversion of 45K. Turbo tax wants me to deduct the 45K by 9200. How do I convert the $45K to a Roth and pay the taxes seperately?

Get your taxes done using TurboTax

You enter the 1099-R for the 401(k) distribution.    Assuming that this is a direct rollover/conversion by the 401(k) trustee, the 1099-R box 1 and 2a amounts will be the same.    There will be no tax withheld on box 4 so you do not enter the tax anywhere.   The tax paid from another source would be entered as an estimated tax in the estimated tax section and have nothing to do with the 1099-R.

 

(Note: if this is not a direct trustee transfer then the trustee is required by law to withhold 20% for tax.)

**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.**

Get your taxes done using TurboTax

BTW:  If you just took a normal distribution and the $9,200 was withheld by the trustee in box 4 on the 1099-R, then the TurboTax 1099-R  interview where is asks what you did with the money and you say you converted the entire amount, TurboTax will ask if you made up the tax from other funds.   

**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.**
SFsarge
Returning Member

Get your taxes done using TurboTax

Thanks for your quick reply. I still have a question though. I have been using TurboTax for a number of years and I've never seen any questions on estimated tax. Is this because I've always paid the tax with the 1099? How do I find the estimated tax form?

 

Carl
Level 15

Get your taxes done using TurboTax

What do you need the 1040-ES form for this late in the game? Enter the 1099-R exactly as printed. If that 1099-R shows taxes withheld, you'll still indicate that you rolled the entire amount. When asked if you made up the difference for what was withheld, indicate that you did. You don't need a 1040-ES to pay *anything* if taxes were withheld on the distribution.

If taxes were not withheld, then simply go online "right now" to www.irs.gov/directpay and pay the taxes right now.

Then you're done with the rollover stuff.