You can achieve the result in TurboTax.
After
entering the Form 1099-R, click the Continue button on the Your 1099-R
Entries. Answer Yes when asked if you opened a Roth IRA before
2013. That's all you need to do for this income to be treated as
nontaxable income. The gross distribution amount will appear on Form 1040 line
15a or Form 1040A line 11a but the entire amount will be excluded from line 15b
or 11b.
You will also need to indicate the disability if you are not 59 1/2.
Please
note: A qualified distribution from
a Roth IRA is tax-free and penalty-free, provided that the five-year aging
requirement has been satisfied and one of the following conditions is met:
- Over age
59½
- Death or
disability
- Qualified
first-time home purchase
A non-qualified distribution is subject to taxation of earnings and a 10%
additional tax unless an exception applies. For Roth IRAs, you can always remove
post-tax penalty contributions (also known as "basis") from your Roth
IRA without penalty.
When you are entering this
information into TurboTax, your Form 1099-R, box 7 codes J, Q and T identifies
a Roth IRA distribution and determines the tax treatment. If you have a J or a
Q, the distribution is considered taxable unless there is an exception.
TurboTax will guide you on all the exceptions
(See the attached screenshot below. Click to enlarge.)
