My 1099R has the taxable amount not determined box checked. I have been able to determine this value and entered it in box 2A. Turbo Tax, however, used the gross distribution from Box 1 to calculate the taxable income. How do I correct this?
When you rolled the 401(k) over to the IRA, assuming that the entire gross amount was rolled over, the after-tax basis in your 401(k) became nondeductible contribution basis in your traditional IRAs. To get the distribution from your IRA reported correctly, you must do the following:
- Enter the Form 1099-R as reported on the form provided by the payer (including box 2a being the same as box 1).
- Click the Continute button on the Your 1099-R Entries page.
- Indicate that Yes, you made nondeductible contributions to your traditional IRAs.
- On the next page, click the EasyGuide button
- Proceed to the page where you can mark the box labeled I transferred money from an employer's retirement plan in 2016 or a previous year.
- Enter the dollar amount of basis amount rolled over from the 401(k) plan as the Net Rollover Basis From Employer Plans.
- Enter the explanation regarding the adjustment to basis resulting from the rollover from the 401(k).
TurboTax will use this, the amount of your IRA distribution(s) and your 2016 year-end balance in traditional IRAs to calculate on Form 8606 the amount of your distribution that is taxable.
For 1099R check the actual 1040 line 15b or 16b for any taxable amount. If it was a rollover it should say ROLLOVER by the "b" line. (1040A lines 11b & 12b)
Then you should not fill in box 2a. You enter the 1099R exactly as shown and answer the follow up questions to determine the taxable amount. Leave 2a BLANK.
Is the IRA/SEP/SIMPLE box marked on this Form 1099-R?
Is any amount shown in box 5 of this Form 1099-R?
The after-tax amount of your contributions to the plan is a fixed dollar amount. 6.01% of your contributions being after tax contributions does not make 6.01% of your distribution nontaxable (unless you meant to say that 6.01% of the amount distributed equals the amount of after-tax contributions to the plan). The earnings attributable to the after-tax portion are taxable, so it could be that more or (more likely) less than 6.01% of your distribution is nontaxable, depending on investment performance in the plan.
If this is reporting the distribution from the 401(k), at least 20% of the taxable amount would have to have been withheld for taxes. Did you make up that portion with other funds so as to complete the rollover of the entire gross amount of the distribution?