For a nonqualified Roth IRA distribution, it's your responsibility to differentiate between nontaxable an taxable amounts by preparing Form 8606 Part III. TurboTax prepares Part III based on the gross amount of the distribution reported in box 1 of the code-J Form 1099-R and your entries of your Roth IRA contribution and conversion basis. Be sure to click the Continue button on the page that lists the Forms 1099-R that you have entered and, when asked, enter your basis information.
