Direct Roll Over from Traditional IRA to Qualified Plan treated like income

Forum|Forum|6 years ago
March 20, 2020
2 replies
36 views

I did a direct roll over this year.

Form 1040 Line 4a -- shows the rollover amount. 4b -- "Rollover ""0" -- Correctly showing that the rollover is not taxable income. Great. The rollover amount is also not included in Line 7b. SUPER

HOWEVER,

Turbo Tax including the rollover in an "income" calculation inflates my actual income for 2019 which is preventing me from taking several other deductions. Is Turbo Tax correct?

Thanks

AnnetteB6

Level 15

TurboTax will show the rollover amount as 'income' on some summary screens as you go through the rest of your return. Those summary screens are not used in any calculations to determine your eligibility for other credits or deductions.

Eligibility for credits and deductions is based on information reported on the tax return itself. As you indicated in your question, the rollover is being reported correctly on your actual tax return, so it should not be affecting any other credits or deductions.

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HillDCAuthor

Level 2

Thanks for your reply. I'll dig into the return to find/understand the big difference from last year's return. Suggest TurboTax footnote the summary screens making it clear that those rollover actions aren't being included in the credits/deductions calculations. Such a clarification would have kept me from going into that rabbit hole. Thanks and stay safe.