topic Should my pension distribution be taxed if I rolled it over to an IRA? in Retirement tax questions

Should my pension distribution be taxed if I rolled it over to an IRA?

pjreichel — Wed, 28 Jan 2026 06:00:59 GMT

I rolled my retirement from the state over to another IRA with an organization but Turbotax is stating that I will owe a tax.

Re: Should my pension distribution be taxed if I rolled it over to an IRA?

BillM223 — Fri, 31 Jan 2025 21:49:58 GMT

No, your pension distribution should not be taxed if it is rolled over to an IRA.

However, you need to tell TurboTax that this is happening.

In the screens after the initial entry of the 1099-R, There are a variety of questions over one to several screens.

One question is "Tell us if you moved the money through a rollover or conversion" (in the Online version - the desktop version may be worded differently).

One or more options below will let you indicate that it was a rollover. Once you check that, the rollover amount will be tax-free.

Re: Should my pension distribution be taxed if I rolled it over to an IRA?

pjreichel — Fri, 31 Jan 2025 23:01:00 GMT

Thanks so much for your reply however, when I went to look over the questions again they appear confusing. The first one asks, "Did you move the money to a Roth IRA?" Mine just went to a regular IRA so I said No.

The second question is, "Did you move this money from a 401(k) to a Roth 401(k)?" Also states: This includes rollovers from a regular 401(k), 403(b), or 457(b) plan to a designated Roth 401(k), 403(b) or 457(b) plan.

The Yes answer states: Yes, I moved the money to a Roth 401(k), Roth 403(b), or a 457(b) plan. Is this the one I should be checking yes? Seems like it should include the term IRA also.

Re: Should my pension distribution be taxed if I rolled it over to an IRA?

dmertz — Fri, 31 Jan 2025 23:40:31 GMT

Since the rollover was to a traditional IRA, you should not indicate that is was rolled over to any kind of Roth account. Answer No to these questions.

Given the questions that TurboTax is presenting, it seems that your Form 1099-R has code G in box 7. If so, once you indicate that the rollover was not to any kind of Roth account and the taxable amount shown in box 2a of the From 1099-R is zero. TurboTax will automatically treat the distribution as nontaxable. The gross amount will be included on Form 1040 line 5a but will be entirely excluded from the amount on line 5b with the ROLLOVER notation.

Re: Should my pension distribution be taxed if I rolled it over to an IRA?

pjreichel — Sat, 01 Feb 2025 00:02:08 GMT

Thank you, this is what I initially thought and did answer the questions with a No.

You are correct in that I have a G code in box 7 and box 2a is 0.

However, when Turbo Tax completes the review my total retirement income shows a taxable $ amount.

Another page shows a taxable pension distribution $ amount as well.

I assumed both would show 0.

Re: Should my pension distribution be taxed if I rolled it over to an IRA?

dmertz — Sat, 01 Feb 2025 05:28:22 GMT

All amounts distributed from retirement accounts are "income" as defined in the tax code. However, amounts rolled over to a traditional IRA are not taxable income. To see the amount of a pension distribution that is treated as taxable you must look at Form 1040 line 5b.

Re: Should my pension distribution be taxed if I rolled it over to an IRA?

kd0imh — Sun, 02 Mar 2025 22:26:36 GMT

I have the same issue as above. It's a 457(b) from a state government employer that I rolled over into a traditional IRA. Total distribution, Box 7 is G. Turbotax is counting it as taxable income (online version).

Re: Should my pension distribution be taxed if I rolled it over to an IRA?

DoninGA — Sun, 02 Mar 2025 22:32:53 GMT

@kd0imh wrote:

I have the same issue as above. It's a 457(b) from a state government employer that I rolled over into a traditional IRA. Total distribution, Box 7 is G. Turbotax is counting it as taxable income (online version).

Look at your federal tax return, Form 1040 Line 5b. There should be 0 entered on Line 5b and the word ROLLOVER entered to the left of Line 5b.

Click on Tax Tools on the left side of the online program screen. Click on Tools. Click on View Tax Summary. Click on Preview my 1040 on the left side of the screen.

Re: Should my pension distribution be taxed if I rolled it over to an IRA?

DawnC — Sun, 02 Mar 2025 22:36:56 GMT

It is listed under income on the income summary, but not as taxable income on your tax return. You may need to delete the 1099-R and then re-enter it. Make sure you answer the follow-up questions where you detail the rollover amounts. Then check your tax return. The full amount will be on 5a, but you should see the word ROLLOVER and a zero on line 5b (taxable distribution).

How to delete forms in TurboTax Online

Where do I enter a 1099-R?

Preview Form 1040 in TurboTax Online.

Re: Should my pension distribution be taxed if I rolled it over to an IRA?

dmertz — Sun, 02 Mar 2025 22:37:19 GMT

Also, the Form 1099-R provided by the payer should have a zero in box 2a if the rollover was to a traditional IRA. With a zero in box 2a, TurboTax will not treat it as being taxable. If box 2a contains a nonzero amount, the code-G Form 1099-R is reporting a rollover to some type of Roth account.