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Retirement tax questions
"the "taxable amount" in box 2a should be listed as "taxable" on line 5b on the 1040!"
If your 401(k) had basis in after-tax contributions and direct rollovers paid to the traditional and Roth IRAs were scheduled to be made at the same time, the taxpayer is permitted to select how the pre-tax portion is allocated between the traditional and Roth accounts. TurboTax cannot automatically split the rollovers without the additional information from the taxpayer indicating how to split the gross amount and the taxable amount between the rollovers. TurboTax obtains this additional information by requiring the user to enter each of the rollovers as a separate Form 1099-R. This is not a bug, it's a design choice intended to avoid an overly complicated user interface that would serve to confuse most users because most user's code-G Forms 1099-R report rollovers only to a single destination.
For a distribution reported with code G that was split between traditional and Roth accounts to be taxable to the extent shown in box 2a of the Form 1099-R, you could not have nay after-tax basis in the plan from which the distribution was made. If your Form 1099-R shows $0 in box 5, TurboTax could infer that the amount shown in box 2a went to a Roth IRA and and the rest when to a traditional IRA, but does not, and instead produces an incorrect amount on Form 1040 line 5b. However, given that TurboTax already requires splitting the From 1099-R into two when the distribution includes after tax basis, it's not unreasonable that TurboTax would require that any Form 1099-R that shows a split rollover be split into two for proper reporting. An alternative to splitting the Form 1099-R in this case would be to change the code to 2 or 7.