Can turbo tax help me with net unrealized appreciation and a 401k rollover

[MichaelL1]

Yes, you should have a 1099R for the rollover.

To enter pension and annuity Payments (1099-R)

•    Click on Federal Taxes
•    Click on Wages and Income
•    Click on I'll choose what I work on (if shown)
•    Scroll down to Retirement Plans and Social Security
•    On IRA, 401(k), Pension Plan Withdrawals (1099-R), click the start or update button

Box 6. If you received a lump-sum distribution from a qualified plan that includes securities of the employer’s company, the net unrealized appreciation (NUA) (any increase in value of such securities while in the trust) is taxed only when you sell the securities unless you choose to include it in your gross income this year.

 If you did not receive a lump-sum distribution, the amount shown is the NUA attributable to employee contributions, which is not taxed until you sell the securities.

[MichaelL1]

Can you give me some more details so I can help?

[MichaelL1]

I added box 6 net unrealized appreciation, which will not matter in a rollover.

[steve-morley]

I exercised NUA and I'm not sure how I will know that I benefited from the tax advantage if I use Turbo.

[MichaelL1]

OK thank you, I am still a little bit confused as you told me the question you did a Rollover.  

Now if you exercised the NUA it will be taxed as Long Term Capital.  

Please see what I put below and maybe you can explain also if you did the NUA amount and then rolled over the rest of the money.  Tell me if the return shows the capital gain.  It does get entered in the 1099R as I posted in the answer above.

[MichaelL1]

When you distribute money from your IRA, you pay ordinary income taxes on those distributions (assuming your original contributions to the account were made with pre-tax dollars). Company stock rolled into the IRA is treated the same way.

But if you withdraw your company stock from your 401(k) and, instead of rolling it into an IRA, transfer it to a taxable brokerage account, you avoid ordinary income taxes on the stock's net unrealized appreciation (NUA) (regardless of whether you sell or continue to hold the stock). The NUA is the difference between the value of the company stock at the time it was purchased (and put into your 401(k) account) and the time of distribution (transferred out of the 401(k)). So the only part of your company stock that is subject to your ordinary income taxes is the value the stock was when it was first acquired by the 401(k) plan.

In sum, because of this NUA tax break, it may be most beneficial for you not to roll over your company stock from the 401(k) into an IRA. (However, the other assets in the 401(k) – such as mutual funds, etc. – do not receive the NUA tax break, so you would still likely want to roll these plan assets into an IRA and continue deferring taxes on past and future growth.)

[Kathytaxes]

If My broker did not deduct for taxes for a Net Unrealized Appreciation must I send an estimate tax before end of year? I transferred the money into a Joint Account non-IRA!

[dmertz]

The deadline for payment of 4th quarter estimated tax payments is January 15.  See IRS Tax Topic 306 regarding the requirements to avoid an underpayment penalty that might otherwise result from the taxable amount of the distribution:  https://www.irs.gov/taxtopics/tc306