@BDUBYAC , the $50,000 of after-tax money rolled over to your Roth IRA became basis in nontaxable conversions. With only that and $5,000 of investment gains earned within your Roth IRAs, under the Roth IRA distribution ordering rules the $50,000 of nontaxable contribution basis comes out first, free of income tax. IRA distributions that are free of income tax are also free of any early-distribution penalty.
After entering the code-J into TurboTax, click the Continue button on the page that lists the Forms 1099-R that you have entered. TurboTax will then ask you to enter or confirm your basis in regular Roth IRA contributions and your basis in taxable and nontaxable conversions. TurboTax will then use this information to prepare Form 8606 Part III to determine that the $50,000 distribution is nontaxable.
