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Why is 1099-R being taxed in 2017 when same distribution was not taxed in 2016?

in 2016 I had a 1099-R distribution of $6K, it was an early distribution, the ira/sep/simple box was checked. Federal Tax Due window did not change at all. In the next window its says, no extra taxes are due. This was not an inherited account. It was moved from one retirement account to a Roth IRA and all was left in that Roth IRA. In 2017 I had the same 1099-R distribution. It is $5.5K. As before, it was an early distribution, ira/sep/simple, but Federal Tax Due window went up by several thousand. Everything else was the same. Only change I can see from 2016 to 2017 is that total income went from $143K in 2016 to $164K but that includes the $5.5 1099-R distribution. Why is the 1099-R distribution being treated as income in 2017 and not in 2016? Why does turbo tax in 2017 say no extra tax is due when it is being counted as income and the taxes go up?

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Expert Alumni

Why is 1099-R being taxed in 2017 when same distribution was not taxed in 2016?

The Refund Meter is sometimes not accurate until you finish entering all your income and deductions.

In Forms mode, look at your Form 1040, Lines 15b and 16b to see if this income was taxable.   It is the Code in Box 7 on the 1099-R that designates the type of distribution.

If this was a final distribution from the account, be sure to go through the questions carefully. 

Also, if you are receiving Social Security, and your income was higher in 2017, more of your Social Security may be taxable, which would affect your total tax.  Check Line 20b for this.

A good way to check is to compare your 2016 Form 1040 with your 2017 Form 1040.

If you feel your 1099-R is not correct, you should contact the Payor. 

Here's more info:

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