TurboTax question on 1099R doesn't include all options: "Did you move this money from a 401(k) to a Roth 401(k)? This includes rollovers from a regular 401(k), 403(b) or 457(b) plan to a designated Roth 401(k), 403(b) or 457(b) plan. "

[AnnLL]

The TurboTax question on my 1099R:

"Did you move this money from a 401(k) to a Roth 401(k)? This includes rollovers from a regular 401(k), 403(b) or 457(b) plan to a designated Roth 401(k), 403(b) or 457(b) plan. "

The option does not include the fact that we moved money from a 457b to a Roth IRA (Roth conversion). Should I say yes, because it was moved from a qualified plan to a designated Roth?  On the 1099R box 7 is marked as G, as it was in-plan rollover from 457(b) to a Roth IRA.

Thanks!

[dmertz]

Your answer to this question should be No.  TurboTax asks separately to determine if the rollover was to a Roth IRA.  TurboTax needs to know the difference because it affects how Roth IRA contribution and conversion basis is tracked.

[AnnLL]

Thanks -- I just tried both options.

If I answer no, I get another question about whether this amount was converted to a Roth IRA. If I answer yes to that, TurboTax is not adding the conversion amount to taxable income (it should, but it's not). . It seems to be considering it an in-plan rollover to a tax-deferred rather than after-tax account and does not calculate how how much we would owe in taxes on the conversion. In the 1040, that amount is no longer listed in income.

Answering "Yes" to that first question does treat the amount as a taxable event, and in the 1099R summary worksheet, it shows the amount as a  being contributed to a Roth IRA. It's just that the language in the question never mentions a Roth IRA, and then when it asks separately about a Roth IRA, it doesn't treat it correctly.  If I answer yes to the first question, in the 1040, the total amount (Roth conversion plus standard withdrawals) is listed as taxable income as it should be.

[AnnLL]

Thanks again for the suggestion. I decided to delete the 1099R and start over.

I answered No to this first question and Yes to the question that was specifically about Roth IRA and now everything is showing up properly.

Thanks agian!