Has anyone had problems with IRA rollovers showing as taxable on return even though program said " congratulations-these distributions are not taxable"'?

Forum|Forum|5 years ago
February 16, 2021
6 replies
63 views

To me this seems like a Turbo Tax programming error.

TurboTax Deluxe Online

Best answer by dmertz

If you've already filed with your rolled over distribution shown on Form 1040 line 4b as taxable, yes, you'll need to amend. Wait for your tax return to be processed, then amend using TurboTax by deleting the originally entered Form 1099-R, reentering it indicating that none of the distribution was RMD, indicating that you moved the money to another retirement account or back to the same account, then indicating the amount rolled over. TurboTax will then prepare Form 1040-X showing the change to your AGI, taxable income and tax. In the explanation you'll need to indicate that the change is because your originally filed tax return did not show the rollover. TurboTax will also update Form 1040 to exclude the rolled-over amount from line 4b and to include the word ROLLOVER next to this line, but you won't file that since the Form 1040-X with explanation takes its place.

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DanaB27

Employee Tax Expert

Please be aware that the distribution amount will show on the summary page. To verify your rollover please look at Form 1040 line 4. If you rolled over the complete distribution then 4b (taxable amount) will be $0.

Click on "Tax Tools" in the left menu
Click "Tools"
Click "View Tax Summary" in the Tool Center window
Click on "Preview my 1040" on the left

If this is not the case then please go back to the 1099-R section and review your entries carefully.

Login to your TurboTax Account
Click on the Search box on the top and type “1099-R”
Click on “Jump to 1099-R”
Read follow-up questions carefully.

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randy-jones33Author

Level 2

Thanks for the response. I believe the problem I experienced could relate to my answer to the question about RMD amount. I did the rollover after the CARES act allowed delayed rollovers of RMD disbursements that were taken prior to the passage of the CARES act. I indicated on my return that all IRA funds disbursed were RMDs. I think I need to file an amended return that shows none of the disbursements were RMDs since the CARES act waived the RMD requirements for the 2020 tax year. Does this make sense?

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dmertzAnswer

Level 15

If you've already filed with your rolled over distribution shown on Form 1040 line 4b as taxable, yes, you'll need to amend. Wait for your tax return to be processed, then amend using TurboTax by deleting the originally entered Form 1099-R, reentering it indicating that none of the distribution was RMD, indicating that you moved the money to another retirement account or back to the same account, then indicating the amount rolled over. TurboTax will then prepare Form 1040-X showing the change to your AGI, taxable income and tax. In the explanation you'll need to indicate that the change is because your originally filed tax return did not show the rollover. TurboTax will also update Form 1040 to exclude the rolled-over amount from line 4b and to include the word ROLLOVER next to this line, but you won't file that since the Form 1040-X with explanation takes its place.