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Retirement tax questions
@jlaufer1 - Unfortunately, that does not "solve" the problem, but creates a new one.
A 401(k) distribution 1099-R with a code G and a zero on box 2a, indicates a direct rollover to a *Traditional* IRA, not a Roth IRA.
The IRS receives a copy of the 1099-R form the payer and what you report must match that 1099-R. The IRS also receives a 5498 for from the receiving IRA custodian and expects to find a Traditional IRA deposit, not a Roth.
If you instructed the 401(k) custodian to roll this to a Roth IRA then box 2a should have had the same amount as box 1. If that is the case then the 401(k) trustee needs to issue a corrected 1099-R.
If, *you* changed the IRA account type on your own to a Roth, then you need to delete the 1099-R and use a substitute 1099-R (last choice on the 1099-R type screen) with the same information as the original 1099-R except box 2a would be the same amount as box 1 (unless there is a box 5 amount, then box 2a would be box 1 minus box 5). You would select the interview choice that the distribution was rolled to a Roth IRA.
The substitute will ask for an explanation statement where you state that the 401(k) was actually converted to a Roth IRA rather then being rolled to a Traditional IRA. Without the substitute 1099-R and the explanation statement you will probably be receiving letters form the IRS in about a year or so when they match the forms.
A 401(k) distribution 1099-R with a code G and a zero on box 2a, indicates a direct rollover to a *Traditional* IRA, not a Roth IRA.
The IRS receives a copy of the 1099-R form the payer and what you report must match that 1099-R. The IRS also receives a 5498 for from the receiving IRA custodian and expects to find a Traditional IRA deposit, not a Roth.
If you instructed the 401(k) custodian to roll this to a Roth IRA then box 2a should have had the same amount as box 1. If that is the case then the 401(k) trustee needs to issue a corrected 1099-R.
If, *you* changed the IRA account type on your own to a Roth, then you need to delete the 1099-R and use a substitute 1099-R (last choice on the 1099-R type screen) with the same information as the original 1099-R except box 2a would be the same amount as box 1 (unless there is a box 5 amount, then box 2a would be box 1 minus box 5). You would select the interview choice that the distribution was rolled to a Roth IRA.
The substitute will ask for an explanation statement where you state that the 401(k) was actually converted to a Roth IRA rather then being rolled to a Traditional IRA. Without the substitute 1099-R and the explanation statement you will probably be receiving letters form the IRS in about a year or so when they match the forms.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
‎June 5, 2019
11:38 PM