topic I rolled stock out of my 401k & need to pay taxes on the cost basis. I entered the 1099R taxable amount into Turbo Tax; however, TT isn’t including in the taxes due calc. in Retirement tax questions

I rolled stock out of my 401k & need to pay taxes on the cost basis. I entered the 1099R taxable amount into Turbo Tax; however, TT isn’t including in the taxes due calc.

KarleyMc — Mon, 23 Feb 2026 10:20:31 GMT

Re: I rolled stock out of my 401k & need to pay taxes on the cost basis. I entered the 1099R taxa...

DanaB27 — Tue, 24 Jan 2023 18:59:40 GMT

To verify, did you take a distribution (cash) or moved the funds to another similar retirement account?

If you made a rollover (moved the funds into another similar retirement account) then this will not be taxable. You can check line 5b of Form 1040 how much was taxable.

To preview Form 1040:

Click on "Tax Tools" in the left menu
Click "Tools"
Click "View Tax Summary" in the Tool Center window
Click on "Preview my 1040" on the left

If this doesn't answer your question please provide more details and we will be happy to assist you. What is the code in box 7 of your Form 1099-R?

Re: I rolled stock out of my 401k & need to pay taxes on the cost basis. I entered the 1099R taxa...

fanfare — Wed, 25 Jan 2023 17:54:15 GMT

the cost basis of stock taken from a 401k is the closing value on the arrival of the stock in your regular account.

Did you later sell that stock ?

@KarleyMc

Re: I rolled stock out of my 401k & need to pay taxes on the cost basis. I entered the 1099R taxa...

dmertz — Tue, 24 Jan 2023 21:04:46 GMT

Or did you do a lump-sum distribution that included Net Unrealized Appreciation reported in box 6 of the Form 1099-R provided by the payer?

Re: I rolled stock out of my 401k & need to pay taxes on the cost basis. I entered the 1099R taxa...

KarleyMc — Wed, 25 Jan 2023 12:56:47 GMT

Thanks for the response.

I moved the shares of stock out of my 401(K) and am holding it. This allows me to pay taxes on the amount that I paid for the stock, which is the taxable amount shown on Form 1099-R, box 2a. The issue is Turbo tax is calculating the capital gains on this entry. Perhaps it’s a TurboTax issue.

Re: I rolled stock out of my 401k & need to pay taxes on the cost basis. I entered the 1099R taxa...

fanfare — Wed, 25 Jan 2023 13:15:37 GMT

"This allows me to pay taxes on the amount that I paid for the stock,"

This is not correct. you pay ordinary income tax on the value you took out.

if "taxable amount not determined" does not have a mark, you will pay tax on the taxable amount shown.

@KarleyMc

Re: I rolled stock out of my 401k & need to pay taxes on the cost basis. I entered the 1099R taxa...

dmertz — Wed, 25 Jan 2023 13:27:11 GMT

What you seem to be describing is a distribution of appreciated employer shares. When reported correctly, TurboTax handles these correctly.

1. What is the code in box 7 of the Form 1099-R provided by the payer?

2. Is the Net Unrealized Appreciation shown in box 6 of your 1099-R?

3. Is box 2b Total distribution marked?

4. Is any amount shown in box 3 of your 1099-R?

If you were born before January 2, 1936, there might be an amount in box 3 of the Form 1099-R that is eligible for capital-gains election and could be the reason that you are seeing capital-gains tax. Look to see if your tax return includes Form 4972 Part II that would result from you telling TurboTax to make this election.