We got a total payout on one IRA, but we put it back into another plan. How do I not count this 1099-R as income?

[ThomasM · Accepted solution]

When you're inputting your 1099-R information into TurboTax (Federal Taxes > Wages & Income > Retirement Plans and Social Security > IRA, 401(k), Pension Plan Withdrawals (1099-R) you'll be asked What did you do with the money?

You'll want to select I moved the money to another retirement account.  Then answer the additional questions.  TurboTax will show the distribution as a rollover and you won't pay taxes on it.

[AuPhinger]

TurboTaxThomas, EA:  What you advise makes total sense, but I do NOT see the question "What did you do with the money?" anywhere.

[AuPhinger]

Second comment:  The full cash-out 1099-R has Code G - Direct rollover and rollover contribution, but I still do not find the question about what we did with the money.

[ThomasM]

If your box 7 code is "G" then your rollover was "direct," which means it was transferred between the institutions (and you never actually took possession of it).  In that case, the code "G" is enough for TurboTax to make it non-taxable.  So you won't be asked the question about moving the money.  You're fine.

[AuPhinger]

Thank you so very much.  I am just getting started, but the amount is still being treated as "income", and it has me fretting!

[ThomasM]

TurboTax may still call it "income" but you can look in the upper margin of the screen and click on "My Account" then "Tools" then "View Tax Summary" (from the list of Other Helpful Links), then above the summary page you'll see a link for "Preview My 1040."  That will load the 2-page Form 1040 and you can check lines 15b or 16b to check that the taxable amount was zero.

[AuPhinger]

Thanks to all, I got things sorted out!!  Great speedy responses!