@Trabia78 wrote:
I really appreciate all of your responses. According to page 2 of the 1099-R, the Code G states "Direct rollover of a distribution to.......an IRA. The IRS gives us 60 days within which to rollover to an IRA. We rolled over the 401K money to an IRA within seven (7) days. Also, Fidelity never properly advised us regarding the 3-27-2020 ruling that due to the pandemic, we are not required to take a distribution. We just took the money out and within 7 days, we rolled it over. We learned about the 3-27-2020 pandemic ruling last week when I started to prepare taxes via TurboTax. The problem is that our AGI will go up and our social security checks will go down. We live in $64,000 per year before taxes. I do not undertand these reponses.
Yours was NOT a direct rollover so code G is not proper and there can be not be 4 tax withholding with a code G.
In indirect rollover and a Code G will do the same thing if the money was rolled back. Neither one is taxable. However, a code 7 with box 4 withholding (that was also part of the distribution) means the the box 4 withholding IS a taxable distribution and must be accounted for. You cannot say that the entire box 1 amount was rolled over if part of box 1 was withheld in box 4, unless the box 4 tax was made up for with other funds at the time of the rollover - TurboTax will ask about that.
**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.**
