topic 1099-R generated Form 5329, I am 67+, should not have 10% penalty. in Get your taxes done using TurboTax

1099-R generated Form 5329, I am 67+, should not have 10% penalty.

blee64 — Sat, 06 Mar 2021 01:47:31 GMT

2020 form 1099-R for 2019 roth contribution reversal
Form 1099-R gross distr: $8900, taxable amt: $1900, distr codes: PJ

I am amending 2019 tax return for above roth contribution reversal.
Received the 1099-R Jan 21, 2021.
TurboTax created form 5329 for additonal tax of $190 (10% on Early Distribution for people less than 59 1/2 years old.)
I am currently 67+.
What do I need to do in TT to correct this form 5329 tax penalty issue?

Re: 1099-R generated Form 5329, I am 67+, should not have 10% penalty.

VolvoGirl — Sat, 06 Mar 2021 01:49:25 GMT

New help article for getting the 10% penalty
https://ttlc.intuit.com/community/tax-topics/help/why-do-i-still-get-10-penalty-on-the-withdraw-of-my-retirement-even-though-i-answer-the-questions/00/2023931

Re: 1099-R generated Form 5329, I am 67+, should not have 10% penalty.

macuser_22 — Sat, 06 Mar 2021 01:52:37 GMT

Unfortunately a code J means you are under age 59 1/2 but for a return of contribution the J is required to specify that it is a Roth.

That is the consequence of the IRS using code J for two unrelated things.

If you are over 59 1/2 then on the "Lets see if we can lower your tax bill" enter the box 2a amount in the "Another Reason" box to eliminate the 10% early withdrawal penalty on the earnings.

Re: 1099-R generated Form 5329, I am 67+, should not have 10% penalty.

blee64 — Sat, 06 Mar 2021 02:07:07 GMT

macuser_22 -- Thank you so much. This fixed the problem.

You are so the expert!!

-blee64