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Retirement tax questions
It depends on if your contributions were made with pre-taxed or after tax dollars. A contribution made with after tax dollars is a non-deductible contribution. If there is an amount listed in Box 5 of the 1099R, this is an amount you made with after tax dollars and you will use this amount in Step 10 to figure out the taxable portion of your distribution
Keep in mind, you do not need to make calculations on your own as the program will do this for you. ThomasM125 thoroughly explained how the taxable amount of the annuity is determined and how Turbo Tax makes the calculation.
- Open or continue your return.
- In the Federal section, select Wages & Income.
- Scroll to locate Retirement Plans and Social Security.
- Select Start or Revisit next to IRA, 401(k), Pension Plan Withdrawals (1099-R)
- Begin entering the 1099 R information.
- When you fill this out, leave Box 2A blank and check the box that says taxable amount not determined,
- After the 1099R is entered, there will be a series of questions you will answer including the state where you live.
- Enter that this is a qualified plan unless it's a military pension or the other exceptions that are listed.
- After answering a few more questions, there will be a screen that says Let's Figure How much is Taxable. here you will say that you need to figure out how much is taxable.
- Next screen will have you put in a breakdown on the annuity start date, plan cost, number of months you received payment, etc. The plan cost are contributions you made with after tax dollars. This is usually reported in Box 5 of your 1099R.
- Next screen is where you will report your age.
Note: If Box 5 of the 1099R does not have an amount or if you are not sure if you made non-deductible contributions in the past, then the full distribution is taxable. If you are uncertain, you might wish to call the plan administrator to ask if non-deductible contributions were made by you and what are the totals.
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