psushu
Returning Member

Retirement tax questions

Last year I erred in thinking that deferred compensation was still earned income when it was distributed.  So I took a distribution from my deferred comp and proceeded to put it into my Roth IRA account.  Don't worry the Deferred Comp has been resolved.  As has the Roth IRA contribution.  I withdrew it before April 15, 2020.

 

I realized the error and withdrew the money from the Roth IRA account  before April 15, 2020 along with the $56 in interest.  Hence, a 1099R with a code of 8.

 

So I owe tax on the $56.  But when I enter the 1099R info it into Turbo Tax, in addition to entering the $56 on line 1 of my 1040 SR, it also decreases the tax schedule amount on line 16 by the same $56, from $11,815 to $11,759.

 

That doesn't make sense to me.  Or is this some coincidence?