If it was re-deposited within 60 days of the distribution, you can mark this as an indirect rollover which will not be taxable. The amount of taxes withheld will still be credited towards this year's tax returns, so you will get the benefit this year. You will not receive any benefit for pre-paying the taxes when you pull this money out again in the future. To report this correctly in TurboTax:
- Search for 1099-R and select the Jump to link in the search results.
- Continue through the screens to import or enter your 1099-R form.
- When asked Tell us if you moved the money through a rollover or conversion select I rolled over some or all of it to an IRA or other retirement account within the time limits (normally 60 days) and Continue.
- On the next screen, Did you roll over all of this (Box 1) to another retirement account? answer Yes, I rolled over to an IRA or other retirement account (or returned it to the same account) and Continue.
The wording may be a little different depending on how your 1099-R is coded, but as long as you re-deposited within 60 days you can mark it as a rollover and it will not be taxable.
