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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?