401k rolllover

Forum|Forum|5 years ago
May 12, 2021
1 reply
10 views

We received a 401k distribution, and rolled it over to Vanguard. Turbo Tax is showing it as income???

401K

SusanY1

Level 15

It should show it as income, but that income should be nontaxable.

Certain summary screens within the program show all items entered whether they are taxable or not and in this instance- so you may see it displayed here as "income", though it is not taxable.

Rollovers are also reportable on the tax return. On Form 1040 you should see the amount reported on Line 5a, but absent from Line 5b. If the transfer was a direct transfer with a code G in Box 7 on your 1099-R this will happen automatically.

If the rollover was indirect, be sure that you indicate that a rollover was made in the follow-up questions that TurboTax will ask after you complete the entry of all of your 1099-R forms.

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andcindy

Level 2

I have the same issue, a rolled over 401k from my deceased husband is counted as income. The problem is that it raised my taxes due !!! even though it is not taxable income. How can I correct this?

ThomasM125

Level 15

@andcindy After you enter your form 1099-R information, you will see a screen that says What Did You Do With The Money From (name of company?) You need to select the I moved the money to another retirement account and then I rolled over all of this money to another traditional IRA account options.

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