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1099 form questions
Hi,
I filled out a 1099-R tax form for an inherited IRA life insurance fund. I took a lump sum payment but do not know how to classify it on Turbo Tax. There is a drop down menu with a list of choices and would like to know which I should choose.
I also opened an Inherited IRA from my father but didn't receive a 1099-R form. How would I go about entering this? I know I don't have to pay taxes on it but I'm sure it must be reported.
Thanks
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Get your taxes done using TurboTax
To enter a Form 1099-R, here are the steps:
In TurboTax online,
- Sign in to your TurboTax account and select Pick up where you left off
- At the right upper corner, in the search box, type in "1099r" and Enter
- Select Jump to 1099r
- Follow prompts
You will only receive a Form 1099-R if you take a distribution from a retirement plan or IRA. If you did not take any money out of your inherited IRA, you would not receive one.
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I already entered the 1099-R information but when Turbo Tax was finishing up my return
it gave me a drop down menu to specify what type of income this was. I didn't see anything
regarding a lump sum payment from being the beneficiary or this account.
So if you have an inherited IRA you don't have to report it until you withdraw money from it?
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Yes, that is correct. You generally won't report anything related to the Inherited IRA until you get a 1099R for a distribution.
The only thing that should be reported is any basis that you have in the Inherited IRA. (This would be the same basis as your father had in the IRA - ie- any non-deductible contributions he had made.) If that is true, those questions will be in TurboTax after you enter any 1099R.
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There seems to be some confusion here. I had two separate questions regarding two different accounts.
I have a life insurance annuity where I was named a beneficiary and took a lump sum payment. I received a 1099-R form from the insurance company and entered the information in Turbo Tax. When I was finishing up the federal return Turbo Tax asked me to specify what type of income this was with a drop down menu of options. I didn't see anything regarding a lump sum payment so I was wondering what I should choose?
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Get your taxes done using TurboTax
The only drop down menu in the 1099-R section is for the box 7 code. You should check box 7 on your copy of the 1099-R form and select the corresponding number. For example, code 7 means Normal distribution.
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