Did not report Qualified Roth Distribution - should I file an amended return ? Oops ... Tom

[MargaretL · Accepted solution]

Yes, you should report form 1099-R reporting your Roth Distribution. Form 8606 must be filed when receiving a distribution from a Roth IRA.  If your return has been submitted- please wait - if it's rejected for some reason, you can add your 1099-R and re-send the return.

If your return has been submitted and accepted- you will have to amend; the return is mailed; takes about 16 weeks to process. Here are amending instructions.

[Tom in Carolina]

Hey Margaret - Thx for the speedy reply.  Just to confirm the facts: I am 65 years old and the money has been in the Roth for more than 5 years, hence it is not penalized or taxable. Do I still need to report it ?  If so - would it be better to wait and see if I get audited since it is not a taxable event? Many thanks, Tom

[MargaretL]

No, it would not be better to wait... because the IRS may charge you $50 for not filing Form 8606, even though the event is not taxable. I recommend amending to avoid the $50 penalty.

[Tom in Carolina]

I efiled with Turbo Tax and the return was "accepted".  Should I go ahead and submit the amended return now ?
Thanks again, Tom

[MargaretL]

If you are due a refund, wait until you receive the refund. It'll be easier for data entry. If you have tax due, you may amend it now.

[Tom in Carolina]

If amending a return is a red flag for an audit, would you recommend paying the Turbo Tax Audit protection fee ?

[MargaretL]

Amending is not a red flag at all, it goes to completely different processing center and millions of people amend it for so many reason...

[Tom in Carolina]

M - you are my hero - many thanks, Tom