Retirement tax questions

A code G check is never made out to you, it might be made out to your IRA, with your name on it, but only the IRA trustee can cash it.

 

The question is:  what type of account did tell the 401(k) trustee that the rollover was going to? 

 

If you told them a Roth, as your question implied " I was told that this would result in me paying taxes on the rollover distribution amount." .   It would only be taxable if going to a Roth.

 

If *you* decided to put it into a Traditional IRA instead then  the error is on your part for not answering "YES" to the TurboTax interview question that the money went to a Roth IRA which would have made is all taxable.

 

If in fact, that is what happened, and the money is actually in a Traditional IRA and not a Roth, then the remedy is to file a substitute 1099-R (the 1099-R type screen has that option) to replace the 1099-R that you have, and enter exactally as the 1099-R you have but make box 2a  0 (zero) .  Then enter an explanation that the distribution want to a Traditional IRA instead of a Roth IRA.

 

If you just file as is, that will guarantee a IRS audit in about a year because what you reported on you tax return is in conflict from what the 1099-R is reporting.

 

Are you sure it is in a Traditional IRA and not a Roth IRA?

**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.**

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