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Retirement tax questions

Lisa995 is correct.  You can show a negative number in Line 21 with the caption, “Distribution to Nominee YYY, SSN xxx-xx-xxxx.”  The negative number on Line 21 will adjust the income of the reported payee to the correct amount.  The reported payee will issue a Form 1099-MISC to the nominee payee for nominee’s share of the distribution. 

You can enter a negative income adjustment with the following menu path:

  1. Federal Taxes
  2. Wages & Income
  3. Less Common Income
  4. Miscellaneous Income
  5. Start
  6. Other Reportable Income
  7. Start
  8. Other Taxable Income
  9. Description = “Distribution to Nominee YYY, SSN xxx-xx-xxxx”
  10. Amount = -$xxx

TurboTax will transfer this to your Form 1040, Line 21, Page 1.

You can e-file with this approach because the disclosure is on the face of the return at Line 21.  Consequently, you do not need to attach a statement.