When will update be available to allow the QTP to Roth IRA transfer?

[CatinaT1]

Are you trying to report a rollover from a 529 plan to a Roth?  

If your rollover met all SECURE 2.0 Act requirements, it should not be taxed. If TurboTax is calculating a tax on your 529 converted to a Roth IRA, it is likely because you manually entered Form 1099-Q into the software, or because the transfer did not meet the strict IRS criteria for a qualified rollover.

Here are the 2025 tax regulations that must be met for this rollover to be tax-free:

• The 529 account must have been open for at least 15 years.
• The beneficiary of the 529 account and the owner of the Roth IRA must be the exact same person.
• The rolled-over funds (and any associated earnings) must have been in the 529 account for at least 5 years.
• The beneficiary must have earned income in 2025 that is equal to or greater than the $7,000 converted.
• The conversion must have been a direct trustee-to-trustee transfer.
• The rollover cannot exceed the 2025 annual Roth IRA contribution limit ($7,000 if under age 50; $8,000 if 50 or older) and counts toward the $35,000 lifetime rollover limit per beneficiary.

If your conversion meets all of the requirement above, IRS Publication 970 says that this is a non-taxable event and should not be reported on your tax return. Entering the Form 1099-Q into TurboTax triggers the software to treat the earnings as a non-qualified, taxable distribution.

To stop the rollover from being taxed, you must delete the form in TurboTax:

1. Select Tax Tools from the left-hand menu.
2. Select Tools.
3. Select Delete a form in the pop-up window.
4. Locate Form 1099-Q on the list and select Delete next to it.
5. Confirm the deletion and select Continue with my return.
6. You must retain your Form 1099-Q and the Form 5498 you will receive from your Roth IRA custodian in your personal records in the event of an IRS inquiry.

[nikkiwags]

So my situation may be slightly different. Yes, I can delete form 1099-Q but along with my rollover from my 529 plan to my ROTH IRA, I also had another distribution from my 529 plan this year. There are two distributions that show on my 1099-Q. I cannot delete it because the other distribution needs to be entered into Turbo Tax.

My rollover from my 529 plan to my ROTH IRA does meet every single regulation you have listed. Right now like you said it is counting this as a taxable event.

Also if I go in to make different selection such as selecting both 4A as trustee to trustee transfer :

Box 4a: Was this a trustee-to-trustee transfer?

Yes

Box 4b: Was this transfer from a QTP to a Roth IRA?

Yes

It gives me an error and says: "Boxes 4a and 4b cannot both be 'Yes.' Choose the one that describes the type of transfer."

Please assist.

[AmyC]

We expect an update for the1099-Q, hopefully tonight. Please check back tomorrow to see if the issue is resolved.

[nikkiwags]

Hi I am still not seeing the update. I am still getting the same error message when I try to e-file. Can you check on that? Thanks! @AmyC 

[CatinaT1]

If you are using desktop software you may need to do a manual update. Try clearing your Cache and Cookies and then try this link instructions.

If you are using the online software, Clear Cache and Cookies. 

[nikkiwags]

@CatinaT1 I am not using the desktop version, I am using the online software and the app. I have already updated it to the latest update and cleared my cache and cookies and I still don't see the update for the QTP to ROTH, it still says "Our program has not updated to support this yet. Please check back later for updates."

[MonikaK1]

I was just advised that the work on the Form 1099-Q box 4b for Qualified Tuition Program (QTP) transfers to Roth IRAs is still in progress, and that the updated target date for completion is March 19th. Update and check TurboTax on the 20th for releases from the 19th.

@nikkiwags

[CuriousHere]

This isn't a new item...why is it taking so long for an update on something like this?

[CatinaT1]

If the only distribution from the 529 was for the purpose of rolling it to a Roth, you can follow this:

If your rollover met all SECURE 2.0 Act requirements, it should not be taxed. If TurboTax is calculating a tax on your 529 converted to a Roth IRA, it is likely because you manually entered Form 1099-Q into the software, or because the transfer did not meet the strict IRS criteria for a qualified rollover.

Here are the 2025 tax regulations that must be met for this rollover to be tax-free:

• The 529 account must have been open for at least 15 years.
• The beneficiary of the 529 account and the owner of the Roth IRA must be the exact same person.
• The rolled-over funds (and any associated earnings) must have been in the 529 account for at least 5 years.
• The beneficiary must have earned income in 2025 that is equal to or greater than the $7,000 converted.
• The conversion must have been a direct trustee-to-trustee transfer.
• The rollover cannot exceed the 2025 annual Roth IRA contribution limit ($7,000 if under age 50; $8,000 if 50 or older) and counts toward the $35,000 lifetime rollover limit per beneficiary.

If your conversion meets all of the requirement above, IRS Publication 970 says that this is a non-taxable event and should not be reported on your tax return. Entering the Form 1099-Q into TurboTax triggers the software to treat the earnings as a non-qualified, taxable distribution.

To stop the rollover from being taxed, you must delete the form in TurboTax:

1. Select Tax Tools from the left-hand menu.
2. Select Tools.
3. Select Delete a form in the pop-up window.
4. Locate Form 1099-Q on the list and select Delete next to it.
5. Confirm the deletion and select Continue with my return.
6. You must retain your Form 1099-Q and the Form 5498 you will receive from your Roth IRA custodian in your personal records in the event of an IRS inquiry.

[mttSkys]

I hope this gets fixed soon.  In California, this is a taxable event.  So the form cannot be deleted to work around the lack of support in TurboTax.

[viv888]

Will this be fixed by end of this week? 

[nikkiwags]

@MonikaK1 We need confirmation this will be updated by end of week please, we all need to file. Please confirm the date! 
@viv888 @mttSkys 

[ETM]

TurboTax is treating this as income in spite of the Publication. In addition, if you have recorded one of these, you still get an error message saying to wait for the update. 

You can not get to an agent these days and we keep seeing wait for a new update. I would like to know when this is promised.

Making me wish I had bought a different product and with customer service so poor -- had to go through a back door to get to Community -- can't get past the purchase product -- more than seriously considering revoking the auto download.

[viv888]

Not fixed yet....