Double check Box 7 and the IRA box on your 1099-R

[lisawei2022]

Hello,

Last year, I rolled over a SIMPLE IRA to a 401(K). Both plans were under the same employer.

On my 1099-R, the distribution amount is in Box 1, Box 2a is zero, and Box 2b has total distribution checked. Box 7 is coded G and also has the IRA/SEP/SIMPLE box checked.

In TurboTax, when I input this 1099-R, I am getting the below message:

You indicated that you converted a traditional IRA to a Roth IRA with Code G in Box 7. However, if this is true it should have Code 1, 2, or 7 instead.

If the money you took out isn’t from a traditional IRA, then the IRA box should not be checked.

If you need to make changes, select Back. If this matches exactly what’s on your form, we recommend you contact your provider to correct it.

Please note that I never indicated that I converted a traditional IRA to a ROTH IRA. Does anyone know what is going on here?

Thanks in advance

[AnnetteB6 · Accepted solution]

Even though you are getting a message on the screen that your distribution code is incorrect for the situation you described, take a look at your actual Form 1040 to see if the tax treatment is correct without changing your entries.

When a Traditional IRA or other tax-deferred account is directly rolled over to another retirement plan that is also tax-deferred and not a Roth designated account, Form 1040 should show the distribution amount on line 4a with ROLLOVER beside it.  Line 4b should be '0' indicating that there is no tax consequence.  

In TurboTax Online, use the following steps to check your Form 1040 while you are in your tax return:

• In the navigation area on the left side of your screen, click Tax Tools to expand your choices
• Click Tools, which will open the Tool Center
• Click View Tax Summary under “Other Helpful Links…”
• Click Preview My 1040 to see your actual tax form

If you find that your Form 1040 is incorrect, please follow up with more information.  Otherwise, there should be no issues with ignoring the message onscreen and clicking the button to indicate that your information was entered correctly.  

 

[magplar1]

I am having the exact same issue as the person above. Literally, same thing. Switched Simple IRA to 401k plan. Amount appears on box 1, nothing on box 2, box 2b has total distribution checked. Box 4 empty. Box 7 has code G and IRA/SEP/SIMPLE is checked. 

I don't understand why I keep getting that error and it makes me nervous because I'm afraid to mess something up. I did what you said, - went to tax tools and clicked view tax summary and when I see the 1040 it states ROLLOVER and 0 on 4b. Does this mean I'm good? I can disregard that error message?

[DaveF1006]

Yes, it is correctly stated on the 1040 with the proper distribution code. See if you can move on from the error message.

[lisawei2022]

Thank you! My 1040 was the way you said it should be!