Schedule 2, Line 8 calculates "Additional tax on IRAs or other tax-favored accounts" that I believe is in error

[Retired10]

I rolled over money from a Profit Sharing Plan to a traditional IRA, so I received a 1099-R. I believe the entire rollover is tax-free. However, 2022 turbotax Premier (download) calculates an "Additional tax on IRAs or other tax-favored accounts" that is entered on Line 8 of Schedule 2, which then shows up on Line 23 of Form 1040(2022). I have looked closely at my entries on Form 1099-R, and believe they are correct. I have not made any excess contributions to any other IRA, and I am too young to need to take Required Minimum Distributions. How do I get Line 8 of Schedule 2 to be zero? Thanks.

[fanfare]

what is your distribution code, Box 7 ?

@Retired10 

[Retired10]

Box 2a lists $0.00, and Box 7 lists G.

[BillM223 · Accepted solution]

From what you have said, I don't see a reason for a penalty to appear on line 8 in Schedule 2 (1040).

However, line 8 which comes from the 5329 can be populated by many numbers. The 5329 records these penalties:

1. Additional Tax on Early Distributions

2. Additional Tax on Certain Distributions From Education Accounts and ABLE Accounts

3. Additional Tax on Excess Contributions to Traditional IRAs

4. Additional Tax on Excess Contributions to Roth IRAs

5. Additional Tax on Excess Contributions to Coverdell ESAs

6. Additional Tax on Excess Contributions to Archer MSAs

7. Additional Tax on Excess Contributions to Health Savings Accounts (HSAs)

8. Additional Tax on Excess Contributions to an ABLE Account

9. Additional Tax on Excess Accumulation in Qualified Retirement Plans (Including IRAs).

I know that you have excluded some of these, but what about the others?

[VolvoGirl]

Did you also enter the rollover under Deductions & Credits like a contribution?  Only enter it from the 1099R nowhere else.

[Retired10]

Thank you. I made an error on 1099-SA, in the HSA contributions page, by accidentally typing in the HSA contributions in both fields. That error then created an entry on Form 5329, which in turn created an entry on Schedule 2. I changed the erroneous entry in the second HSA contributions field to "0" and Schedule 2 disappeared.