We took out a 30k loan from 401k Nov '17 Repaid within the 60 days in Jan '18 they issued a 1099R as distribution. Can I fix in turbo tax or should Vanguard correction?

[kathysherman1]

It looks like the 1099R was made about the time we were repaying the 401k loan.

[dmertz]

What is the code in box 7 of the Form 1099-R?
Is the IRA/SEP/SIMPLE box marked?

[kathysherman1]

Hi.  The code is 7 in box 7 and the IRA/SEP/SIMPLE box is X'd.

[dmertz · Accepted solution]

The Form 1099-R provided by Vanguard is correct.

The X in the IRA/SEP/SIMPLE box indicates that this is a distribution from a traditional IRA, not from a 401(k).  This was also not a "loan" from the IRA but was a distribution and rollover (even though you made use of the money while outside the IRA).

Enter the Form 1099-R exactly as received under Wages & Income -> Retirement Plans and Social Security -> IRA, 401(k), Pension Plan Withdrawals (1099-R).  In the follow-up, indicate that you "moved the money to another retirement account (or returned it to the same account)."  Then indicate that you rolled over all of the money (assuming that that is the case).  TurboTax will include the amount shown in box 1 of the Form 1099-R on Form 1040 line 15a or Form 1040A line 11a but exclude the amount rolled over from the amount on line 15b or 11b.  TurboTax will also show the word ROLLOVER next to the line.

[kathysherman1]

THANK YOU!  I will try this.  🙂

[kerriP]

You need to contact Vanguard if they were the company that handled both the loan and the repayment.  They should be able to provide a corrected 1099-R relatively quickly.