1099-R - Same?

[jenaort]

My son left his job and found new employment elsewhere. He withdrew his 401K into an IRA, but then immediately withdrew the money from the IRA. Basically, he attempted to withdrawal directly from his employer, but mistakenly rolled into an IRA, so he then had to withdrawal from the trust bank. He received three 1099-Rs -- (1) BNY Mellon Disbursement Agent, Dallas County Hosp Ret; (2) Charles Schwab Bank Custodian, IRA Rollover O/S Account; (3) Charles Schwab Trust Bank, IRA Rollover Omnibus Account. The first two have the same gross amount and the third has an increase gross amount of $0.83. 

When entering all three 1099-Rs into Turbo Tax, the Other Income total includes the amount he withdrew x's 3. So his Total Income for 2019 includes his Wages and Earnings plus Retirement Plans. It looks like he received his retirement 3 x's. 

This is an example:

Wages & Salaries = $15,940
IRA Distribution - taxable = $1,949

Pensions - taxable = $1,948

Pensions - nontaxable = $1,948

Total Income = $21,785

Is this correct? Should I enter all three 1099-Rs?

[macuser_22]

Yes.   The rollover is tax free.  The distribution form the IRA will be taxable.  It is not clear what the 3rd 1099-R is for, unless a corrected 1099-R.

It will show as income on the summary screen which shows gross income, not taxable income.

The IRS requires reporting all income on a *income* tax return - taxable and not-taxable.

The income will be reported on line 4a (or 4c) and 4b (or 4d) on the 1040 form with the word “ROLLOVER” next to it if it was a rollover.

The taxable amount will go on the 1040 line 4b (or 4d). In the case of a rollover, nothing goes on 4b (or 4d).

[dmertz]

There is an inconsistentcy in that #2 appears to be being treated in TurboTax as a taxable pension distribution (IRA/SEP/SIMPLE box not marked on the Form 1099-R) despite the title of the account indicating that it is an IRA.

If all three forms were entered as received, it does seem that #3 is a correction of #2.  Check the account numbers shown on these forms and check for the CORRECTED box being marked on #3.  If the account numbers are the same and the CORRECTED box is marked on #3, delete #2 from the tax return.

However, if #2 was incorrectly entered by not marking the IRA/SEP/SIMPLE box on TurboTax's 1099-R form to agree with the marking on the Form 1099-R provided by the payer, it's possible that #2 represents a separate IRA-to-IRA rollover to the account from which a later distribution was made, reported on #3.  It makes little sense that simply moving an IRA within Schwab would be done by distribution and rollover rather than by non-reportable trustee-to-trustee transfer.  If the IRA/SEP/SIMPLE box is actually marked on #2 and the entry in TurboTax needs to be corrected, perhaps the money was distributed out of the first IRA, was rolled back into another IRA at Schwab within 60 days, then was later distributed out of the second IRA later the same year, in which case all three Forms 1099-R must be entered and the second one reported as having been rolled over.  In this case you need to get more details from your son about of the sequence and types of transactions.