dmertz
Level 15

Retirement tax questions

Marking the box to indicate a qualified distribution will in some cases produce the correct taxable result, but it will not produce a correct Form 8606.  Making that box will cause TurboTax to omit Form 8606 Part III entirely, likely resulting in a letter from the IRS indicating underreporting of income.  Overriding Form 8606 line 20 is the only way to get a correct Form 8606.