dmertz
Level 15

Retirement tax questions

There is a lot of misinformation on these forums with regard to code G.  Code G is used for both taxable and nontaxable direct rollovers.

 

My guess is that the IRA/SEP/SIMPLE box on this Form 1099-R is not marked, indicating that the direct rollover was from a traditional account in a qualified retirement plan like a 401(k), not an IRA, to a Roth IRA.  (Code G is never to be used for a Roth conversion from a traditional IRA.)  For a rollover to a Roth IRA this Form 1099-R should have the taxable amount in box 2a, not $0.  If you financial advisor handled this transaction, I would first contact the financial advisor to find out if they properly advised qualified retirement plan that the rollover was to be to a Roth IRA and, if so, contact that qualified retirement plan to obtain a corrected Form 1099-R since this was their error under these circumstances.

 

If the financial advisor did not properly indicate to the qualified retirement plan that this was a rollover to a Roth IRA, the plan is not likely to correct the Form 1099-R.  In that case you could get TurboTax to treat the rollover as taxable by entering a zero in box 5 of TurboTax's 1099-R form and indicating in the questions that follow that the rollover was to a Roth IRA.  However, it's possible that the IRS will think that you have overreported income if you do this.  The alternative is to prepare a substitute Form 1099-R (Form 4852) in TurboTax showing the correct taxable amount in box 2a, but doing so will prevent you from e-filing.