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posted Jun 4, 2019 6:06:56 PM

Why is Sect 1035 Distrib with 1099-R Box1 $33K Box 2 $0.00 and Box 7 as "6" showing as $33K as Retirement income? How to correct?

This is a Life to Life where Distribution of 33,039 was sent directly to the new insurer.  I entered the info from the 1099-R as shown to 

Box 1  Gross Distribution  $33,039           Box 2 Taxable Amount $0.00     

Box  2b Total Distribution           Box 5  $24,808  and 

Box 7 "6 - Section 1035 Exchange.  

The entire $33,039 is included in my Retirement Income

What did I do wrong and how do I fix it?

0 1 459
1 Best answer
Level 15
Jun 4, 2019 6:07:03 PM

Look on the 1040 line 16.   16b (taxable amount) should be zero or blank.  

The income summary screen will show the box 1 amount as income because it is income, but not taxable income.

1 Replies
Level 15
Jun 4, 2019 6:07:03 PM

Look on the 1040 line 16.   16b (taxable amount) should be zero or blank.  

The income summary screen will show the box 1 amount as income because it is income, but not taxable income.