We rec a distribution from a profit sharing plan. They took out fed tax but the distribution was placed in a qual. retirement plan within 30 days. How do we get taxes ?

[Anita01 · Accepted solution]

Enter the 1099-R and Continue to answer the followup questions, on  of which asks what you did with the money.  You can choose that you rolled it into a qualified plan.  You don't just get that money back.  The tax withheld is added to your total tax withheld for the year and it's applied to your total taxable income for the year.  You get back any excess over and above what you owe for the year.

[SweetieJean]

Be sure you indicate the correct dollar amount that was rolled over.
Essentially, you owe taxes on the amount that was withheld, since that part was not rolled over.

[jeffhss]

So we are getting a return, does the money from the fed return have to be placed in the retirement account or is it just plain money?

[Anita01]

No, the refund amount does not get put into the profit sharing plan, but to avoid paying tax on the amount withheld, you would need to include that amount in what you rolled over into the plan

[SweetieJean]

and it is already past the 60 day limit for rolling over a 2018 distribution.