Form 1099R Box 2a is blank. but Box 2b (taxable amount not determined) is checked. How do I know how much in box 1 is taxable?

[LenJacobs]

If I leave form 1099R as received, the taxable amount is "not determined" although I am pretty sure that the Gross Distribution is fully taxable. Please advise.

[Coleen3 · Accepted solution]

It is entirely possible that it is taxable. 

If box 2a is blank (there's nothing in there), that doesn't means the box 1 amount is nontaxable. Rather, it is up to you to determine from your records the nontaxable amount to enter in box 2a. 

If this was from a pension and you made after tax contributions, then there would be an amount 5 or 9. The portion of your payment(s) that is not taxable is shown in Box 5 of the 1099-R. It is this amount that the IRS considers a return of your previously taxed contributions.

Box 9b on the 1099-R shows the amount of the employee "contribution" to the retirement plan. "Basis" in a retirement plan is also called "cost" or "contribution". In a word, it is the amount of after-tax dollars that the taxpayer contributed to the retirement plan over the years while he/she was employed.

If it is for an IRA, you would need to know any nondeductible contributions.

For a Roth:

When you are entering this information into TurboTax, your Form 1099-R, box 7 codes J, Q and T identifies a Roth IRA distribution and determines the tax treatment. If you have a J or a T, the distribution is considered taxable unless there is an exception. TurboTax will guide you on all the exceptions.

[kengraves1943]

My 1099R has Gross in box 1, Box 2a says unknown, and there I no 2b.  I have tried leaving both 2a and 2b (on my return) blank and it takes it as all nontaxable.  I don't believe that.  How do I find out how much is taxable?

By the way, the 1099 is from the federal government.

[macuser_22]

Is this the first year?   If not then haw did you do it in 2018 - you should use the same method.

That is probably a CSA 1099-R from OPM.

OPM violates the 1099-R rules by writing "helpful" information in the box rather than just the value or code like they are supposed to. OPM has done that for years and it causes more confusion than help. They put UNKNOWN in box 2a when it should be blank, and put "7 NONDISABILITY" in box 7 when is should only be "7", "1" or "2".

The taxable amount in box 2a is usually the box 1 amount unless you have after-tax contributions in the retirement plan and use the simplified method. If this is NOT the first year of receiving payments, then you should use the same method that was used last year - either the box 1 amount or the simplified method, using the carry forward simplified information from last year.

If box 2a is blank or UNKNOWN then there should be amount in box 9b to use with the simplified method. If no amount in 9b then contact OPM to find the account "basis".

Enter a 1099-R here:

Federal Taxes,
Wages & Income
I’ll choose what I work on (if that screen comes up),
Retirement Plans & Social Security,
IRA, 401(k), Pension Plan Withdrawals (1099-R).

OR Use the "Tools" menu (if online version under My Account) and then "Search Topics" for "1099-R" which will take you to the same place.

Be sure to choose which spouse the 1099-R is for if this is a joint tax return.
Be sure to pick the correct 1099-R type: Standard 1099-R, CSA-1099-R, CSF-1099-R, RRB-1099-R.

[NOTE: When you get to the "Your 1099-R Entries" screen where you can add another 1099-R, use "continue" to keep going as there are additional interview questions after that screen in most cases. You can always return as shown above.]

[vmqc77]

How I known to calculate the taxable income from OPM 1099R where the item 2b indicate unknown and item 7 indicate 3-disability?

[macuser_22]

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@vmqc77 wrote:

How I known to calculate the taxable income from OPM 1099R where the item 2b indicate unknown and item 7 indicate 3-disability?

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Depends on if you are older or younger than the earliest age that you could have retired if not disabled.    If younger, then code 3 means that the box 1 income is wage replacement and will just be reported the same way as if it was W-2 income on line 1 of the 1040 form as not as a pension income..     If older, then is treated as a pension the same as if the code was a 7 as explained above.

When you enter the CSA 1099-R code 3, TurboTax will ask what that retirement age is - if you don't know then contact the plan administrator.

[drawlins17]

1099r form  block 2a is blank, how do I determine amount of taxable income?

[ThomasM125]

@drawlins17 The taxable amount of your pension distribution will be determined by the codes entered in box 7 on your 1099-R form and your answers to questions in TurboTax after you enter the form. In general, the amount in box 1 is the taxable amount if you deducted your contributions to the retirement account or your contributions or those made on your behalf were not included in your income when they were made.

[pattie16]

I am in the same boat.  Turbo Tax needs to do a better job with going through this Form - particularly if this is from the federal Office of Personnel Management (CSA Form 1099R) - for federal retirees.  Box 2a says "Unknown" - but when entering data into Turbo Tax,, you cannot enter that word (or any letters) for Box 2a - you can only enter numbers - and if you leave it blank, you then come up with the conclusion and a warning note when you finish entering everything else for the form,  that you meant "0" and that NONE of the distribution is taxable, and a cautionary question do you want to change this. Turbo Tax and I know that this is not probably true.  In my case I have used up all my Total Employee Contributions (Box 9B) over the years, so I presume I should have entered the entire amount of the gross distributions (Box 1), into Box 2a, despite that number not entered on the CSA-Form1099R issued to me. Over the years Turbo Tax calculated the taxable portion using the simplified method when the taxable portion was "Unknown" so it would seem that Turbo Tax should carry over the entire Box 2a amount into Box 2b,  since it has been all taxable for some years now.  Or, Turbo Tax should work with OPM to get them to enter the entire amount into 2b, since OPM knows all the employee contributions have been distributed.

[macuser_22]

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@pattie16 wrote:

I am in the same boat.  Turbo Tax needs to do a better job with going through this Form - particularly if this is from the federal Office of Personnel Management (CSA Form 1099R) - for federal retirees.  Box 2a says "Unknown" - but when entering data into Turbo Tax,, you cannot enter that word (or any letters) for Box 2a - you can only enter numbers - and if you leave it blank, you then come up with the conclusion and a warning note when you finish entering everything else for the form,  that you meant "0" and that NONE of the distribution is taxable, and a cautionary question do you want to change this. Turbo Tax and I know that this is not probably true.  In my case I have used up all my Total Employee Contributions (Box 9B) over the years, so I presume I should have entered the entire amount of the gross distributions (Box 1), into Box 2a, despite that number not entered on the CSA-Form1099R issued to me. Over the years Turbo Tax calculated the taxable portion using the simplified method when the taxable portion was "Unknown" so it would seem that Turbo Tax should carry over the entire Box 2a amount into Box 2b,  since it has been all taxable for some years now.  Or, Turbo Tax should work with OPM to get them to enter the entire amount into 2b, since OPM knows all the employee contributions have been distributed.That is probably a CSA 1099-R from OPM.

OPM violates the 1099-R rules by writing "helpful" information in the box rather than just the value or code like they are supposed to. OPM has done that for years and it causes more confusion than help. They put UNKNOWN in box 2a when it should be blank, and put "7 NONDISABILITY" in box 7 when is should only be "7", "1" or "2".

The taxable amount in box 2a is usually the box 1 amount unless you have after-tax contributions in the retirement plan and use the simplified method. If this is NOT the first year of receiving payments, then you should use the same method that was used last year - either the box 1 amount or the simplified method, using the carry forward simplified information from last year.

If box 2a is blank or UNKNOWN then there should be amount in box 9b to use with the simplified method. If no amount in 9b then contact OPM to find the account "basis".

Enter a 1099-R here:

Federal Taxes,
Wages & Income
I’ll choose what I work on (if that screen comes up),
Retirement Plans & Social Security,
IRA, 401(k), Pension Plan Withdrawals (1099-R).

OR Use the "Tools" menu (if online version under My Account) and then "Search Topics" for "1099-R" which will take you to the same place.

Be sure to choose which spouse the 1099-R is for if this is a joint tax return.
Be sure to pick the correct 1099-R type: Standard 1099-R, CSA-1099-R, CSF-1099-R, RRB-1099-R.

[NOTE: When you get to the "Your 1099-R Entries" screen where you can add another 1099-R, use "continue" to keep going as there are additional interview questions after that screen in most cases. You can always return as shown above.]

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[Savant]

I also find the Turbo Tax handling of form 1099-R as inadequate.  I have a large distribution (completer withdrawal) in box 1, nothing in box 2a and 2b and an amount larger than box 1 in box 5 and code 7D in box 7.

The reality is that box 5 was an amount contributed to an annuity with after tax dollars.  It is therefore clear that none of box 1 is taxable.  After trying everything, Turbo Tax seems unable to handle it and insists that it is taxable in the absence of zero in box 2a.  I am therefore in the process of handling it by including forms directly from the IRS with perhaps an accompanying explanatory note.

[DoninGA]

@dmertz 

[dmertz]

@Savant , the problem is with the payer, not with TurboTax.  Some payer's systems are mistakenly programmed to leave any box blank that would otherwise have a zero, but that general rule does not apply to box 2a because a blank box 2a has a special meaning, that the taxable amount is unknown.  Because the distribution in your case is less than your investment in the contract and is clearly nontaxable, the payer should have put a zero in box 2a rather than leaving it blank.  Just enter a zero in box 2a.

[Snowplow2024]

So I have a 1099R . I pulled $30,000 out of a Roth IRA that I had contributed $50,000 to so over the years with after tax dollars. These should be able to be pulled out tax free, at any time.  My 1099R shows the 30,000 distribution on line 1,  line 2a is blank, line 2b is "taxable amount not determined" , and yet the distribution is coded as "J".  

How do I update the cost basis to equal the disbursement and what do I put in 9a? What do I need to do  make sure this is not a taxable/penalized event?

Help is appreciated!

Cheers!

[DawnC]

Enter your 1099-R into TurboTax as it is.   Code J means Early distribution from a Roth IRA, no known exception.  If box 9a is empty, leave it blank when you enter the form.  When you enter the info from your 1099-R, TurboTax will ask you all the right questions to determine how much, if any, of your Roth IRA distribution is taxable.   

With plans like Roth IRAs, income was already taxed during contribution, and so isn’t taxed now.   Most withdrawals before the age of 59 ½ are considered early distributions, and they’re subject to an additional 10% federal tax on top of the regular income tax rate. Some states also impose a penalty as well. If you withdrew from your retirement because of a hardship like disability or extensive medical expenses, you might not have to pay the same penalty amounts.   Again, TurboTax will ask the necessary questions after you enter the form.  

Typically, if your Roth IRA is less than five years old, any earnings from your distribution will be taxable.  @Snowplow2024 

How does a 1099-R affect my taxes?