Why do my TSP to traditional IRA tranfer show as income? I did a direct transfer of 32K from TSP to Tra IRA in 2018.

[walkbig1]

Why do my TSP to traditional IRA transfer show as income? I did a direct transfer of 32K from TSP to Tra IRA in 2018.  I received a 1099-R that shows a direct transfer but Turbo Tax still shows it as 2018 income which increases my Adjusted income by 32K.

[Anita01 · Accepted solution]

It is indeed part of your income, and you chose to roll it over.  That makes it nontaxable income, but it's still income. Did you actually look at the 1040?  If your 1099-R had a code of G in Box 7, you were asked if the rollover was to a ROTH IRA.  If you didn't answer that question, the program makes it taxable.

Click on Forms in the upper right, then click to open the 1099-R worksheet.  Scroll down to the Rollover section to see what you entered or answered.(If you haven't looked at your 1040 yet, do that first.  If the rollover shows as taxable income, them move on to the 1099 worksheet)