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on my 1099-R I have box 7 Distribution code a 7 .
Why is Turbo tax asking What did I do with the money from my Retirement Service Account . Which is my pension.,
It wants to know if I moved it to another retirement account OR Did I do something else like cash it out ETC.
Its my pension check, I used it to live, pay bills, food, insurance etc.. So how do I answer this Turbo Tax question.
@cpmavrick wrote:
on my 1099-R I have box 7 Distribution code a 7 .
Why is Turbo tax asking What did I do with the money from my Retirement Service Account . Which is my pension.,
It wants to know if I moved it to another retirement account OR Did I do something else like cash it out ETC.
Its my pension check, I used it to live, pay bills, food, insurance etc.. So how do I answer this Turbo Tax question.
Just select "Did something else..." and Continue.
What happens if I'm taking my monthly pension money from my "qualified" plan and putting into a Roth? Do I answer "..moved to another retirement account..."? What's the tax implications if I did that?
I would not answer that you moved it to another retirement account. The distribution is taxable. You don't want to indicate that you did a non-taxable rollover to a Traditional IRA. You don't want to indicate that you did something you didn't do. Reporting to the IRS by the Roth IRA Administrator will eventually result in you getting a letter from the IRS. There is no tax deduction for the contribution to the Roth.
Regular periodic pension distributions for life are not eligible for rollover, so any deposits of this money into a Roth IRA would be regular Roth IRA contributions, not rollovers. You would answer that you "did something else" with the money distributed from the pension plan.
Note that to be eligible to contribute to a Roth IRA you (or your spouse if making a spousal contribution) must have compensation from employment.
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