401A INPUTS

[lydlen]

NEW requirements this year for my 30 year old 401a. Turbotax asks what method I used to calculate the taxable amount. Duh! ---The 1099R says what it is in box 2a. It also asks for 30 year old data on my contributions (I need a time machine.) 

I am considering faking this by reducing the gross amount to the taxable amount, but looking for better suggestions.

Thanks, folks.

[SteamTrain]

Yeah, I wondered about that when I was entering a 401k that had some small after tax contributions.

There is a question just prior to that setup, that asks:

"For the years you received these distributions, was the total amount shown in the form the amount you paid tax on?"

If box 2a is filled in and shows the proper taxable amount, even if lower than box 1, just say YES to that, and the box 2a value will be used on your 1040 as the taxable amount, assuming there wasn't a rollover or xfer to a Roth involved...((box 5 should likely show the difference between box 1 and box 2a))

The question is probably there for folks who have box 2a empty, and the box checked that the taxable amount was undetermined.

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Yeah, that's likely to cause a bunch of mis-entries by folks by those with different box 1 and box 2a values.

I need to go to last year's software now to see how they worded the question.

[SteamTrain]

Sure enough, in prior years, the follow-up question is:

"For the years you received these distributions, was the amount shown in box 2a of the form 1099-R used as the taxable amount?"

Then I can select  "Yes, the amount in box 2a was used as the taxable amount"

(and those are their bolding, not mine)

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@dmertz   I suspect the new wording for 2025 (eliminating the box 2a words) will cause a whole host of messes for folks who have a 1099-R which actually lists a  box 2a value lower than box 1 for (say) after tax contributions. 

[dmertz]

Yup, I went through an example entry myself and found this botched the wording for 2025.  If box 2a has the correct taxable amount, one must answer Yes to this question to get the correct taxable result.  Despite the botched wording of this question, TurboTax will still only include the amount from box 2a in AGI.

Yet another one of the many cases of TurboTax developers adjusting the wording to make it more palatable to users, but losing the intent and misguiding the user.  "Fixing" stuff that isn't broken and breaking it in the process.

[lydlen]

THANKS!

That works. Totals are correct.

Much appreciate your help.

One or 2 glitches every year. You fixed this one early for me.

Len

[SteamTrain]

@GabiU 

Perhaps you and the CHAMPS should review this in your private discussion area.

The way this wording has been changed for 2025, may lead to a lot of  unnecessary confusion and missteps by a few hundred thousand folks with 1099-Rs to enter.

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I just checked the 2025 Online software for that follow-up question, and it is worded the same as desktop.

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I made changes to the current 2025 "Online" question, to change that page to what it was more like in the 2024 software, and pretty sure it should be reused that way.