I did the mega backdoor Roth IRA. Line 5b on my 1040 that Turbotax calculated contains a number that doesn't make sense to me. It seems wrong to me.
I'll use fake numbers to demonstrate the problem.
My 1099-R for my 401k has (fake numbers):
Box 1: $10,020
Box 2a: $12
Box 5: $10,008
Box 7: G
I entered that data into Turbotax. Turbotax then asked me how much I contributed. According to my pay stubs, that's $10,000 (again, a fake number), so I entered that.
Then Tubotax generated a 1040 that has $32 on line 5b. Why $32?
I generated a pdf with "Include government and TurboTax worksheets (optional)" to try to find out. On the "Form 1099-R Summary" part, in the "Pensions and Annuities" section, it says:
22 Total gross distributions from box 1 of Form 1099-R: 10,020
23 Amount of line 22 converted to a Roth IRA: 10,020
25 Gross distribution transferred to Form 1040, line 5a (if partially taxable) or line 5b (if fully taxable): 10,020
26 Taxable amount in box 2a, Form 1099-R: 12
31 Taxable amount of Roth IRA conversions: 20
32a Taxable amount of distributions: 32
32d Taxable amount transferred to Form 1040, line 5b: 32
All other rows are 0.
So it added 12+20 to get 32. Why did it add 12+20? I think the 12 is already included in the 20. There's no reason to add them together. I think line 5b on my 1040 should be 20. What can I do to force Turbotax to generate a 1040 with 20 on line 5b?
I'm using Turbotax Online Premium (according to my receipt). For some reasons that's not in the edition drop down here.
It appears that TurboTax is producing a nonsensical result, but it's because you have made an error that is triggering this behavior. Box 5 of the Form 1099-R says that the distribution includes $10,008 of after-tax contributions, so entering $10,000 when asked how much of after-tax money was included in the distribution is an incorrect entry; the correct entry is $10,008. An entry here different from what is in box 5 only makes sense if box 5 is blank because the payer does not know the correct amount, has also left box 2a blank and has marked box 2b Taxable amount not determined.
It seems that making the $10,000 entry confusing TurboTax because if the $10,000 entry was correct because boxes 5 and 2a were blank, the appropriate result would be $20 taxable. With your incorrect entry of $10,000 TurboTax is doing this calculation, but because box 2a is not blank when it's expected to be, TurboTax is also adding the $12 from box 2a. With the entry of conflicting information, I don't think TurboTax can be faulted for producing a nonsensical result.
The reason that your distribution included $10,008 in box 5 and not just the $10,000 that you thought was correct is something that you would have to work out from your records and other information from the plan.