topic Thanks for prompt reply. Rdm in Retirement tax questions

Where do I enter 403(b) rollover to traditional IRA; options in "1099-R Entries" are to Roth 401k, 403b, IRA only, not Traditional IRA

cklos5567 — Thu, 06 Jun 2019 09:07:26 GMT

details were provided above, TurboTax does not seem to allow entries regarding rollover from 403b to "Traditional" IRA. Where or how do I do this?

To report the rollover properly from this code G Form 109...

dmertz — Thu, 06 Jun 2019 09:07:27 GMT

To report the rollover properly from this code G Form 1099-R, TurboTax only needs to know that the rollover was not to any type of Roth account. There is no need to explicitly indicate that it went to a traditional IRA.

Why does code G distribution on 1099-R from 403b to IRA c...

magarian — Thu, 06 Jun 2019 09:07:30 GMT

Why does code G distribution on 1099-R from 403b to IRA cause AGI to increase? This increases AGI above deductible limits ($118k) for IRA Contribution for 2016.

AGI should only increase if the direct rollover is to a R...

dmertz — Thu, 06 Jun 2019 09:07:32 GMT

AGI should only increase if the direct rollover is to a Roth account, indicated by a nonzero amount in box 2a of the Form 1099-R.

Box 2a should not be blank. If box 2a is blank and box 2b Taxable amount not determined is not marked, enter a zero in box 2a.

Box 2a is blank and 2B Taxable Amount is blank and 2b Tot...

magarian — Thu, 06 Jun 2019 09:07:33 GMT

Box 2a is blank and 2B Taxable Amount is blank and 2b Total Distribution has an X.

Thanks for prompt reply. Rdm

magarian — Thu, 06 Jun 2019 09:07:34 GMT

Thanks for prompt reply. Rdm

So why does MAGI increase with this 403b rollover to an IRA?

magarian — Thu, 06 Jun 2019 09:07:34 GMT

So why does MAGI increase with this 403b rollover to an IRA?

Shouldn't MAGI also be reduced by rolling moneys into the...

magarian — Thu, 06 Jun 2019 09:07:36 GMT

Shouldn't MAGI also be reduced by rolling moneys into the IRA?

This rollover does not increase MAGI. Enter a zero in bo...

dmertz — Thu, 06 Jun 2019 09:07:37 GMT

This rollover does not increase MAGI. Enter a zero in box 2a of TurboTax's 1099-R form.

On Fed Tax Summary, "Your Total Income" still includes th...

magarian — Thu, 06 Jun 2019 09:07:39 GMT

On Fed Tax Summary, "Your Total Income" still includes the 403b distribution.

The Review and Summary screens add everything as income....

VolvoGirl — Thu, 06 Jun 2019 09:07:40 GMT

The Review and Summary screens add everything as income. You have to check the actual 1040 for the taxable amount. It should say ROLLOVER by line 16b

To preview your Online return, go to My Account at the top. Then Tools, then View Tax summary. Then you can click on Preview My 1040 at the top. OR click Review near the top of your screen, and then click Summary right below it. Then Near the bottom of the We Guarantee Your Maximum Refund screen, click the Preview Return link.

dmertz and VolvoGirl thanks for the clarifications. I g...

magarian — Thu, 06 Jun 2019 09:07:42 GMT

dmertz and VolvoGirl thanks for the clarifications. I guess we need to make contributions to Roth IRA instead of IRA. It will simplify (eliminate) Non-deductible contributions issue with IRA. Thanks again.

By that I assume that you mean that you have found that y...

dmertz — Thu, 06 Jun 2019 09:07:43 GMT

By that I assume that you mean that you have found that your MAGI for making a deductible traditional IRA contribution is too high, but your MAGI for making a Roth IRA contribution is not too high.

Yup. So is it possible to do a conversion of the IRA 201...

magarian — Thu, 06 Jun 2019 09:07:45 GMT

Yup. So is it possible to do a conversion of the IRA 2016 contribution into a Roth IRA now? in 2017? or does it have to be done in 2016?

You can convert to Roth whenever you want. The conversio...

dmertz — Thu, 06 Jun 2019 09:07:51 GMT

You can convert to Roth whenever you want. The conversion is taxable income in whatever year the conversion is performed. A conversion now would therefore be reportable on your 2017 tax return. With a potentially significant amount having been rolled over to an IRA from the 401(k), the conversion may be largely taxable, including only a small portion of your basis in nondeductible contributions. If you are eligible to make a Roth IRA contribution, you would likely be better off do that than making a nondeductible traditional IRA contribution and later converting to Roth.

Yes, I see now we made the wrong choice to make 2016 and...

magarian — Thu, 06 Jun 2019 09:07:58 GMT

Yes, I see now we made the wrong choice to make 2016 and expected future contributions to an IRA rather than a Roth. I didn't consider the income limits for either IRA or Roth contributions. I'm not sure we will have future incomes above the $118k limit for IRA contributions. I guess we should open a Roth so in the future we will have that option available.
Thank you for your clarifications.

Again, lots of confusion because the software will not ha...

swalker0322 — Thu, 06 Jun 2019 09:08:00 GMT

Again, lots of confusion because the software will not handle the rollover to simple IRA correctly. So.. you get an erroneous number in AGI. Why not fix the software instead of all this bs every year?

There is no real bug in the software with regard to this....

dmertz — Thu, 06 Jun 2019 09:08:01 GMT

There is no real bug in the software with regard to this. The issue comes in when the payer does not properly show a zero in box 2a when box 2b Taxable amount not determined is not marked. If the Form 1099-R properly shows a zero in box 2a for a rollover from a qualified retirement plan like a 403(b) to a traditional IRA, TurboTax does not include the rollover in taxable income and it does not add to AGI.

Re: To report the rollover properly from this code G Form 109...

NKC00mbs — Fri, 23 Apr 2021 16:28:29 GMT

This is NOT WORKING