topic Re: 1099-R Distribution Codes in Get your taxes done using TurboTax

1099-R Distribution Codes

GGBENCE — Thu, 13 Feb 2025 16:53:22 GMT

I converted $125,000 from a traditional IRA directly to a Roth IRA. What should the appropriate distribution code be? My distribution code listed on the 1099-R is "7" which appears to be incorrect. TT is applying a 10% penalty since I was under 59 1/2 at the time of the transaction.

Re: 1099-R Distribution Codes

fanfare — Thu, 13 Feb 2025 17:08:25 GMT

after entering 1099-R, please CONTINUE to the interview that will address your issue.

@GGBENCE

Re: 1099-R Distribution Codes

ThomasM125 — Thu, 13 Feb 2025 17:16:32 GMT

The code in box 7 is OK. When you answer the questions you see after you enter the Form 1099-R, you need to indicate that you moved the money to another retirement account, did a combination of rolling over, converting, or cashing out the money, and then enter the amount converted to a Roth IRA.

You also have to enter the value of your traditional IRA's at end of year:

Re: 1099-R Distribution Codes

dmertz — Thu, 13 Feb 2025 18:15:46 GMT

Not only is code 7 OK, code 7 is the only correct code under these circumstances.