Not Seeing TurboTax Calculation for IRA Taxable Amount

[ausfaht]

I had a 2017 traditional IRA distribution of $8,000.  However, TurboTax is only showing $1,500 on the taxable amount on form 1040 line 15b.  I don't understand why the full amount of $8K is not the taxable amount (especially since the "Federal tax withheld" shows $1,350).  My 1099R shows "Taxable amount not determined" and it also shows a distribution code of 7 (normal) and the IRA/SEP Simple box is checked.  The TurboTax form titled "Distributions from Pensions, IRAs, etc. does not show a calculation for arriving at the $1,500 taxable amount.  Can anyone explain how the $1,500 was determined?  Thank you.

[MichaelL1]

Can you Edit the 1099R again, and carefully answer the questions that follow.  The 1099R should be entered exactly as you received it, and yes the total should be taxable unless you had some nondeductible contributions in the IRA.

[ausfaht]

I will try to enter the 1099R again.  I did have some nondeductible contributions in years past but I don't think TurboTax would remember those or be smart enough to calculate the non-taxable portions.  Thanks.

[ausfaht]

I just deleted the 1099R in TurboTax and was very careful to reenter it.  I then looked at the Form 1040 line 15b again and it still shows a taxable amount of only $1,500.  Still scratching my head.

[MichaelL1]

I see you are in the download version, go to Forms in the upper right and click on Forms and look at IRA worksheet (on the left side), see if that tells you anything regarding this $1,500.  Let me know.

[ausfaht]

I see it now in the IRA worksheet.  It shows a "Basis for 2016 or earlier years" of $6,500."  I did have contributions that were not deductible in earlier years.  So it appears the difference between the $8,000 2017 distribution and the earlier $6,500 basis is the $1,500 taxable amount.  So my line 15b is defendable.  Thanks everyone for all your help here.

[MichaelL1]

great, I will post something in answer so others know this has been taken care of.

[macuser_22]

Did you take a total distribution of *all* Traditional IRA accounts to that the 2017 December 31 value of *all* existing Traditional IRA accounts was zero?

If not then any after-tax basis must be prorated between the 2017 distribution and the 2017 year end value of all accounts.

The 1099-R interview asks if you tracked your non-deductible basis and then to enter it.   The next screen asks for the 2017 Dec. 31, value of all Traditional, SEP & SIMPLE IRA accounts.   If there were any such accounts, failing to enter that value will result in the entire existing basis to wrongly applied to the current distribution making the tax lower that what it should be and will result in a IRS audit letter an about a year with a tax bill.

The calculations are done on lines 6-15 on a 8606 form that will not be available until about Feb 12 for filing.  The 2017 year end value of all account would be on line 6 if you had any accounts.  It should only be zero if no accounts existed.

[MichaelL1 · Accepted solution]

A non-deductible basis was showing up of $6,500 in your case and that is why you were getting the taxable amount reduced by this amount.

Great, you had the version to look at the tax forms and worksheets.