Form 1099-R Summary Line 26a

[quzdjg02]

There appears to be a mistake in the program in that the "Taxable amount rolled over" on this line is showing up blank instead of the appropriate amount being transferred from the 1099-R.  Has anyone else had this problem?

[macuser_22]

The non-taxable amount rolled over on line 26 a is the difference between the 1099-R box 1 and box 2a.  If box 1 and 2a are the same or box 2a is blank then box 1 is the taxable amount.

[quzdjg02]

Line 26a is for "Taxable amount rolled over" not the non-taxable amount.

Line 26b is for the "Non-taxable amount rolled over"

If the entire amount of the distribution is rolled over (indicated by an X on Line B5 from 1099-R) Line 26a should have the same amount as Line 2a of the 1099-R.   But it doesn't.  It is blank.  The only thing I can see to do is to manually override the the value of Line 26a on the 1099-R Summary

[macuser_22]

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@quzdjg02 wrote:

Line 26a is for "Taxable amount rolled over" not the non-taxable amount.

Line 26b is for the "Non-taxable amount rolled over"

If the entire amount of the distribution is rolled over (indicated by an X on Line B5 from 1099-R) Line 26a should have the same amount as Line 2a of the 1099-R.   But it doesn't.  It is blank.  The only thing I can see to do is to manually override the the value of Line 26a on the 1099-R Summary

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Sorry I mistype in the above post it was supposed to be 26b not 26a.    A rollover with the same amount in box 1 and 2a will indeed be on line 26a.  A rollover

What is on 26a/b will depend on the type of distribution.   I don't think that is used for an IRA since box 1 and 2a must always be the same so there is no non-taxable amount to rollover. 

For a non IRA then if box 2a is less than box 1 then the box  1 minus 2a should be on line 26a and the box 2a on 26b.  If box 1 and 2a are the  same then box 1 will be on 21a and nothing on 26b.

If box b5 is checked then it is not a rollover but is a Roth conversion.  The box 1 amount will be on line 26a and blank 26b because a Roth conversion can only be before tax money.  A 1099-R with box 2a less than box 1 cannot be converted to a Roth - the 1099-R would be improper.

What code is in box 1 on your 1099-R and what are you trying to do?   Is there an amount in box 5?

[dmertz]

The behavior of on lines 26a and b doesn't agree with the labeling of these lines when the Form 1099-R has code G, an amount in box 5 and is reporting a rollover to a traditional account, but it doesn't really matter since the entire rollover is nontaxable anyway.  Just see that line 32a shows $0.  However, lines 26a and b do agree with the labeling if the rollover was to a Roth IRA, which is where the distinction between taxable and nontaxable amounts actually matters.

[quzdjg02]

Thanks for the reply.  To clarify a bit:

I am taking a normal distribution (code in Box 7 on 1099-R is 7) from a 401k and converting it to a Roth IRA.

The gross distribution (Box 1 on 1099-R) is $70,000  

The Taxable amount (Box 2a on 1099-R) is $51,055

The Employee Contrib (Box 5 on 1099-R) is $18,945

On the 1099-R Summary Line 26 is the amount in box 2a   ($51,055)

On the 1099-R Summary Line 26a is blank  (I think it should be $51,055)

According to the program (line B4 on 1099-R) and my understanding of the rules the entire $70,000 is eligible to be converted to a Roth IRA.  What rule limits a conversion to before tax money?

[macuser_22]

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@quzdjg02 wrote:

Thanks for the reply.  To clarify a bit:

I am taking a normal distribution (code in Box 7 on 1099-R is 7) from a 401k and converting it to a Roth IRA.

The gross distribution (Box 1 on 1099-R) is $70,000  

The Taxable amount (Box 2a on 1099-R) is $51,055

The Employee Contrib (Box 5 on 1099-R) is $18,945

On the 1099-R Summary Line 26 is the amount in box 2a   ($51,055)

On the 1099-R Summary Line 26a is blank  (I think it should be $51,055)

According to the program (line B4 on 1099-R) and my understanding of the rules the entire $70,000 is eligible to be converted to a Roth IRA.  What rule limits a conversion to before tax money?

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When I try that, line 26a has $51,055.

What really matters is that the 1040 line 4c has $70,000 and 4d has $51,055 with the word ROLLOVER.   That is the only thing that gets reported to the IRS unless there was also box 4 withholding.

[dmertz]

quzdjq02, that's not the result I get when I enter this Form 1099-R and indicate that it was all converted to Roth.  I see $51,055 on lines 26, 26a, 31, 32a and 32d.  On the IRA Information Worksheet I see $51,055  lines 35 and 59, and $18,945 on lines 36 and 60.  [Edit:  I see that macuser_22 gets the same result that I do.]

Does your tax return include any other Forms 1099-R, in particular, any with code B or code H?

Which version of TurboTax are you using, Windows, Mac or the online?

Is your TurboTax up to date?  Make sure that you have installed the latest updates.

Nothing limits conversions to only taxable amounts.

[quzdjg02 · Accepted solution]

Ok,  I've finally figured it out.  When filling in the data for the 1099-R in Turbotax I had a typo.  Instead of $18,945 I typed $18,946 for Box 5.  For whatever reason line 26a on the 1099-R Summary goes blank with this incorrect value and the taxable amount is basically doubled as a result.  Thanks for responding.

[dmertz]

Bizarre, but not surprising.  The algorithms that produce the results on the 1099-R Summary seem to be very fragile and intolerant of 1099-R entry errors, producing unpredictable results in the case of unusual entries.