1099-R for an old Contributory IRA with after tax $ has "taxable amount" = entire distribution and "taxable amount not determined" box checked. How do I adjust for this?

 
VictorW9
Expert Alumni

Retirement tax questions

It looks like you may have an IRA account built over the years with both deductible and nondeductible contributions. If all contributions were tax-deductible, then all your IRA withdrawal will be considered taxable income.

 

In your case it looks like you also had some nondeductible contributions included in your account, So, you may have to figure out how much of your account is made up of nondeductible contributions. Here is a quick way of calculation the taxable amount:

 

To find the nondeductible portion, take the nondeductible contributions and divide by the current value of your IRA account.

 

                                                            nondeductible contributions

                   nondeductible portion =  ----------------------------------------

                                                                      IRA account value 

 

     Then you will subtract the result of the above from 1 to come up with percentage of the taxable portion of your IRA

 

                             taxable portion = 1 - nondeductible portion

 

     Take this percentage number and multiply it by the amount you withdrew to arrive at the taxable amount of your withdrawal.

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dmertz
Level 15

Retirement tax questions

TurboTax will automatically prepare Form 8606 to calculate the taxable amount.  After you enter the Form 1099-R exactly as received and answer the immediate follow-up questions, click the Continue button on the Your 1099-R Entries page to reach the questions where you can enter or confirm your basis in nondeductible traditional IRA contributions and your year-end balance in traditional IRAs, the information necessary to complete the calculation.