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.
If this was a rollover or conversion, answer the question that you moved the money to another retirement account (can be the same account). The screen will open up with choices of where it was moved.
(If box 7 has a code “G” it will automatically be a trustee-to-trustee rollover).
[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.]
It will show as income on the summary screen which shows gross income, not taxable income.
The income will be reported on line 4a on the 1040 form with the word “ROLLOVER” next to it if it was a rollover.
The taxable amount will go on line 4b. In the case of a rollover, that amount will be zero.
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.
If this was a rollover or conversion, answer the question that you moved the money to another retirement account (can be the same account). The screen will open up with choices of where it was moved.
(If box 7 has a code “G” it will automatically be a trustee-to-trustee rollover).
[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.]
It will show as income on the summary screen which shows gross income, not taxable income.
The income will be reported on line 4a on the 1040 form with the word “ROLLOVER” next to it if it was a rollover.
The taxable amount will go on line 4b. In the case of a rollover, that amount will be zero.
if you rollover from 401(k) into trad. IRA and then converted it into roth IRA, then? what goes on 4a and what goes on 4b?
@tushi_florida - You should have 2 1099-R's for that. The rollover would be non-taxable so nothing would be on 4b and the conversions would be all taxable so that would be on 4b.
I get that but how to enter the actual numbers. for example, two 401(k) got rolled over into IRA (15,000 and 20,000) and then one of them, 15,000, got converted to roth IRA. what number goes to 4a and what number goes 4b? can you explain it?
You enter it as in my answer above. The 1099-R box 7 codes and your answers to the questions will determine the taxable amount. . TurboTax will put the taxable amount on line 4b. The non taxable rollover will go on 4a.
ok. in case I prefer to file manually, do you what number goes on 4a? is it 15+20=35 or 15+20+15=50?
Entering data directly in the forms mode is not supported and you must know exactally what you are doing. Many form entries come form other forms and worksheets. Form entry voids the TurboTax accuracy guarantee.
What actually goes on 4a depends on how you interrupt the convoluted line 4 IRS rules. It also depends if you have other 1099-R's or if and one was partly rolled over and part converted. The line 4a rules have many "if's" and exceptions.
You can read the line 4 rules here: pages 28-30.
<a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/i1040gi.pdf">https://www.irs.gov/pub/irs-pdf/i1040gi.pdf</a>
new rules for 4a and 4b are written as if the writer were writing for two separate lines and did not expect that someone could rollover and then convert funds from 401(k)--->trad IRA --->Roth IRA in the same year.
Question is that if you follow rules then rollover and conversion of the same 401(k) funds you end up putting the same numbers twice in 4a (one for rollover and again for conversion). Basically, you will repeat it twice just because the previous two line (15 and 16) now became one line 4. But it makes no sense.
so, again, two 401(k) got rolled over into IRA (15,000 and 20,000) and then one of them, 15,000, got converted to roth IRA. what number goes to 4a and what number goes 4b? do you put 15+20=35 on 4a or 15+20+[15]=50?
Assuming 3 1099-R's 2 with a box 7 code G and one with box 7 code 1 or 7 and the IRA box checked and no other 1099-R's, line 4a would be 35,000, 4b would be 15,000 with the word "ROLLOVER" next to it (under the 4a amount).
ok. one 1099-R has code G and another 2 in box 7. does it change the calculation?
You said 2 401(k)'s were rolled into a IRA. That would be 2 1099-R's. Then the IRA was converted to a Roth - that would be another 1099-R.
It is not clear just what you did. What are the box 1 amounts? Is the IRA/SEP.SIMPLE box checked on the one with the code 2?
yes. two 401(k)s rolled over into trad. IRA (both have G in box 7). then one was converted into roth IRA (it has 2 in box 7). so what number goes to 4a and what in 4b (assume one was 20,000 and another 15,000 as I wrote earlier)?
Why aren't you just entering each 1099R and let Turbo Tax do it? If you enter directly on the forms you may not be able to efile. And you might miss entering something in an important place. There are many underlying worksheets that you have to make the actual entries on to flow to the right forms.
Please, I got that. But if you would not mind, if you know the answer to my question you can answer it.
Same answer as above. line 4a would be 35,000, 4b would be 15,000 with the word "ROLLOVER" next to it (under the 4a amount).
OK. so no need to enter 15,000 twice in 4a (one for rollover and one for conversion)? you are sure about it?
A conversion is no different that any other Traditional IRA distribution that is 100% taxable. The box 2a amount goes on line 4b and nothing on 4a, but there are many exceptions which is why I had to ask so many questions. If the Traditional IRA had any non-taxable basis, then the answer would be different. If there were other 1099-R's besides those 3 then the answer might be different.
(Some people want to interrupt the convoluted line 4 IRS rules differently.)
Thanks. Xchange sometimes stops to post my comments here.
the point is that 4a is referred two times for situation I describe.
if you converted trad. IRA to Roth:
"Exception 2. If any of the following apply, enter the total distribution "on line 4a" and see Form 8606 and its instructions to figure the amount to enter on line 4b."
"3. You converted part or all of a traditional, SEP, or SIMPLE IRA to a Roth IRA in 2018."
If you rolled over 401(k) to trad. IRA
"Enter "on line 4a" the distribution from Form 1099-R, box 1."
So, we have two mentions of 4a when dealing with rollovers and then conversions (in the same year).
If one rolled over 15,000 one enters 15,000 in 4a and 0 in 4b. But if you also converted that 15,000 to Roth, then one enters 15,000 in 4a and 15,000 in 4b. So we have put 15,000 twice in 4a.
Is it accurate interpretation of Line 4 rules?
Some people what to read the rules that way, but it's mixing apples with oranges. There are two sections in the instructions. IRA's are in one section and pensions, annuities , 401(k), in the other section. IRS rules in on section do not apply to the other section unless that section specifically refers to the other section. Many IRS rules define the same thing different is different sections but the definition only applies to the section that defines it.
The 2 401(k) rollovers are defined in the pension and annuities section that says to put the amount on 4a and nothing on 4b with ROLLOVER next to it.
The Traditional IRA conversion is defined in the IRA section only and what happened with the 401(k) is independent of the IRA rules that say if only one 1099-R and it is all taxable then the taxable amount goes on 4b and nothing on 4a. You cannot apply the pension rules to an IRA from a different section of the rules.
(This subject has been argued to death in other threads and I am not going to discuss further. Until the IRS clarifies it's own convoluted instructions it is pointless. The IRS created this mess by combining two previous lines into one line but did not change the rules to accommodate that combination of lines. That is how they "simplified" the form.)
I totally agree about how IRS makes taxpayers filing easier :(
But does not your point that Roth conversion if "it is all taxable then the taxable amount goes on 4b and nothing on 4a" contradicts what 1040 says in exception 2 (enter the total distribution "on line 4a" and see Form 8606 and its instructions to figure the amount to enter on line 4b.")?
I am assuming that you did not have any non-deductible basis in the Traditional IRA that would make the conversion only partly taxable and the 8606 would apply.
But, yes, to answer the question, if the Traditional IRA contained any after-tax "basis" money then the taxable amount must be calculated on a 8606 form lines 6-15 and the 1099-R box 1 amount would go on line 4a and the 8606 taxable amount which would be less, on line 4b, but if the box 1 amount and the taxable amount is the same then line 4a is blank. (That is the reason that box 2b - not determined - on the 1099-R is checked, to allow for the possibility of preexisting basis in the IRA that makes the taxable amount less than the box 2a amount.)
This is why is is difficult to give a "one size fits all" answer to 4a/4b questions since there are many variables.
for 8606 calculation I meant part II, line 16-18 (when basis is 0). Everything is taxable. does it affect 4a/4b story?
Hi, I think I finally figured out how to do it. You were right. I would just add the relevant notes from pub 590-a and 590-b and Tax Guide 2018 to illustrate the point.
from pub 590-a
1. Rollover From Employer's Plan Into an trad. IRA
"Reporting rollovers from employer plans.
Enter the total distribution (before income tax or other deductions were withheld) on Form 1040, line 4a." ....Enter the remaining amount, even if zero, on Form 1040, line 4b. Also, enter "Rollover" next to Form 1040, line 4b.
2. from pub 590-b
Are Distributions Taxable?
"Reporting taxable distributions on your return.
Report fully taxable distributions, including early distributions, on Form 1040, line 4b (no entry is required on line 4a),".
So, if one rolled over two 401(k)s to trad. IRA and then converted one of them into Roth, rollovers goes on 4a and conversion (taxable distribution?) goes on 4b and no entry on 4a. makes sense? though 'no entry' note still contradicts 1040 4a/4b Exception 2 rules.