@RChisholm wrote:
Dry-running my taxes on Turbotax, I received a 1099-R for RMD distributions in early 2020. I returned the full amount including federal tax to my original IRA account with my custodian advisor, in early 2020 upon the establishment of the CARES Act. When I go through Turbotax in that section, I check "rolled over to the original account." However, the distribution amount is still shown as a taxable amount on line 4a of the Form 1040, and does not indicate "rollover," increasing my federal taxes and adding to total income. The easy solution was to simply change the distribution code on the 1099R to "G" rather than the original 7, normal distribution. That solved everything. But Code G is a "rollover" event, and not necessarily applicable to the CARES Act, but that is essentially what it is. I know I cannot change the code, as I must copy exactly what the original 1099R reported.
Seems to me Turbotax should have a more clear question and answer logic flow to identify a CARES rollover, or we will be paying taxes on the "normal distribution," that we rolled back in to the original account.
A Traditional IRA distribution can NEVER have a code "G".
Simply delete the 1099-R and re-enter and answer the RMD question "that none if this distributions was a RMD" and then indicate that it was rolled over.
**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.**
