One of my 1099-R amounts is not being added to line 4a of the Federal Form 1040. Line 4b is correct.

[prtaylor56]

@samgrif

Whether this TT error leads to any audits or not, why can't TT take 10 minutes to fix it?  Despite your admittedly heroic efforts to analyze all the related IRS instructions, and the impressive mental gymnastics to rationalize TT's result, the fact remains that the gross amount displays as less than the taxable amount on the 1040.  Any six grader knows that can't be right.

Apparently, the TT folks would rather spend the next two months trying to convince more and more people that this obviously nonsensical result is actually somehow correct, or not really a problem, than to just fix it.

A simple fix can be made in TT's worksheet "1040 WKS".  If you right-click on Line 4 (Pensions and Annuities) of that sheet, you'll see that its data source is Line 25 of the TurboTax worksheet named "1099-R Summary".  If you have a fully taxable Pension amount on Line 25 of the "1099-R Summary" sheet, Line 4 of 1040 Wks sheet doesn't pick it up, even though that is its "data source".  Fixing that link gets a sensible result for multiple distributions, some of which are fully taxable while others are not.   

[prtaylor56]

@samgrif

If TT fixed this as described above, all this complaining would go away, they would conform with other tax service providers and software, and the IRS would be perfectly happy.  Even if the IRS doesn't care if Line 4a is less than Line 4b (as some are claiming, without evidence), do you really think they would mind if both 4a and 4b made sense?

[sheafferm]

Having dealt with the federal government in a strict compliance/regulatory environment over many years, I can understand why TT does not want unilaterally to determine that the instructions are in error. However, this is a simple issue that could be resolved between TT and IRS with little effort. This is not the only issue this year I have found that TT seems to have no interest in fixing. If you go to the second page or so when you start your entering your data, there will be a link at the bottom of the page that you can click to find out what’s new in the rates for 2018. When I did that, it gave me the changes for HOH, which it claimed was my status, even though I was MFJ. When I notified TT of that issue, their response was that only the HOH rates changed. I refilled the issue stating that their response was nonsense; they said they would look at it again. The last I checked the issue was still not fixed. Maybe it’s time next year to switch from TT. BTW, I suspect that the IRS does not even check line 4a. At least on my return, it is meaningless in my tax determination. In addition, if 4a has real meaning, this entire issue could be simplified by always entering a value in 4a regardless of whether or not all distributions were taxable.

[iamwhoiam]

It doesn't work for me.  I have  IRA distributions from different IRAs and a pension with total pension different from taxable amount.  According to IRA instructions, I need to put my multiple distributions as well as my total pension in 4a and all that shows up is the pension info from BOX 1 of the 1099.   4b shows taxable IRA distributions and taxable pension amount correctly but 4a is not right

[steve17]

This was fixed for me in a recent update. 4a shows the full total and 4b shows the taxable part only!

[goodog2]

Hello steve,
If what you report is in fact a fix, then Hooray to all of us who commented.  TT has not been very responsive to this issue.     From goodog2

[samgrif]

avian99 and Steve - I downloaded all fixes yesterday and the "issue" of line 4a and 4b still exists in my version.  I did the test of changing the taxable pension on line 2a to something less than line 1 of the 1099-R and then 1040 shows totals of both IRA and pensions (ie partially taxable pension).  But as of now I think that TT is still working as the IRS has documented in their 1040 instructions (ie fully taxable pensions are not included in line 4a, only the taxable portion in 4b of 1040).  Finally if you take a look at your 2017 1040 there were lines 15a and b and 16a and b.  Line 16 for pensions also did not include fully taxable pensions on 16a, so that's the same as not including on 4a for 2018.   I file this way and my refund should be here by Tuesday.  

[iamwhoiam]

@samgrif Did you e-file and are you getting the amount you expected?  Also was line 4b less than line 4a on your return?  I also noticed that 15 a was blank on my 2017 return but 16 a was not because my taxable pension was different from my total pension amount.  On my 2018 form 4b is less than 4a by about $5,000 due to the IRA distributions not being included.
@steve I downloaded new updates yesterday and 4b still less than 4a.  I will check again today.  Nope...no updates for  me and so 4b remains less than 4a.

[samgrif]

avian99 - yes I did efile and my refund is exactly as expected.  I would also assume that if your IRA distribution was fully taxable then the gross distribution from that would also not be included in line 4a.  The point being is that 4a is only used IF a distribution is not fully taxable for either an IRA or a Pension.  So in your case your IRA is not included, and in my case my pension was not included.  My IRA is not fully taxable due to some old contributions I made that were after tax.  Check page 29 of the 1040 instructions on the IRS site.  This confirms what I assumed earlier about IRA being fully taxable.  So if someone enters 1099s with fully taxable IRA and pensions, then 4a would be totally blank!  It's 4b that the IRS cares about.

[bealdb]

Line 4a must include the total amount of all 1099-R distributions.  Any other answer is incorrect.   Others have noted that Turbo Tax is not handling the line 4a entry correctly.  The fact that Line 4b may be correct is irrelevant.  Line 4a is wrong.

[goodog2]

The TurboTax program needs to be repaired.  IRS clearly states the procedure.  It is worth observing that the parent company, Lacerte has followed the IRS procedure.  Let's have some action here, fix the glitch so we can submit our returns.

Also see Pub 17, Chapter 10, Page 75 in "How to report"

[prtaylor56]

Complaining to other users accomplishes nothing.  I have been doing it for at least a week. They either just agree that it's a problem, or claim that it's OK, nothing to worry about, and even actually compliant if you carefully interpret the IRS instructions, etc.

I have also reported the TurboTax worksheet errors that are actually causing this, and suggest you and others do so as well since that should be harder for them to ignore. That means waiting on the phone for maybe an hour or more to talk to someone who doesn't seem to understand, but says they will ask for it to be checked out anyway.  

In any case, I guess that's our best shot, so here is the explanation of the worksheet errors behind this error on Line 4a:

Look at TurboTax sheet "1040 Wks" Line 4, the sub-line labelled "Pensions and Annuities".  Right-click on the box there and see that it's data source is Line 25 of the TurboTax worksheet "1099-R Summary".  Go to that worksheet and see that Line 25 is labelled "Gross distribution transferred to Form 1040, Line 16a".  Obviously that label should be changed from "16a" to "4a", and that is a mistake on a TurboTax worksheet, not an IRS Form. Also note a similar labeling mistake on Line 32d of sheet "1099-R Summary".

But the bigger problem is that when there is an amount on Line 25 of the 1099-R Summary worksheet, the 1040 Wks Line 4 that is supposed to take its entry from there remains blank.  Fixing that will also fix this Line 4a problem.

[sheafferm]

The instructions for Form 1040, line 4a and 4b, are poorly written. As noted in previous comments, the instructions for more than one distribution are only in the IRA discussion and hence should apply only to the IRAs. That is almost certainly not what the IRS intended. If TurboTax wants to resolve this issue, it merely needs to obtain a clarification from the IRS and then ensure that interpretation is implemented. In the meantime, the taxable amount appears to be determined correctly and the fact that the total distribution is less than the taxable amount does not affect the return.

[prtaylor56]

TurboTax should have tested this very common scenario (partially taxable IRA and fully taxable pension, or vice versa) months ago, noticed the absurd result on line 4a, and sought clarification then.  Really, I don't know why someone has to "clarify" for you that line 4a (gross amount) can't be less than line 4b (taxable portion).  A sixth grader knows that.

Yes, the IRS instructions are subject to (mis)interpretation, but TurboTax chose the only interpretation that leads to a nonsense result, and is determined to stick with it , despite all the user complaints.

[goodog2]

Hello prtaylor56
Well I think you nailed completely.  (Also I tested my return to see if TT did in fact fix the issue with a recent download update.  No such luck.  Do you think the programmers at TT are sitting around in a room laughing joking about this?

goodog2