To ed_b. – The last sentence of my post answers this – There is a bug in TT software and you need to get around that bug to E-file. You are NOT trying to submit an erroneous tax document to the IRS. Remember, the IRS gets a copy of the 1099R directly from the payer. You do not submit it with your filing, nor does TT.
For example, for an IRA distribution, the “1099R” that TT generates when you download the info from the payer (or enter manually) is an internal document to TT to help prepare your taxes and generate the dollar value that goes on line 4b of your 1040. It is easy to verify this.
If I compare the 1099Rs I get from my payer with the related “1099Rs” generated in TT, they are not identical. While key information – amount of distribution, taxes withheld, payer and payee tax ID – is identical, the TT “1099R” does not include other text information that clearly differentiates my two 1099Rs from the payer that coincidentally have identical distribution and tax numbers.
My IRA distribution included 1099R’s for each of more than a dozen individual funds within my IRA. If I add those, including the cents column, I get: $XX,XX6.99. If, before adding them, I first round them to whole dollar amounts, I get: $XX,XX8. So, if I now round the former I get: $XX,XX7. If I look at line 4b on the 1040 generated by TT it is: $XX,XX8. So TT must be rounding each 1099R before adding them together. IRS permits you to do either, so reporting either $XX,XX8., or $XX,XX7., on line 4b of form1040 would be acceptable to IRS. Also, since the IRS gets the 1099R directly from the payer they would also have the information that distinguishes two 1099Rs with coincidentally identical distribution and tax values.
This also explains why the $.01 and similar small adjustment solutions work to get your E-file accepted and does not put you at risk with the IRS: it provides a numerical difference that the TT filter can use to differentiate two apparently identical 1099Rs, but does not alter what appears on line 4b in a material manner.
