DE State Income Tax Error

[romakulus]

Hello, I am working on my 2019 taxes and think there is an error in how Line 35 of DE Form 200-01 is calculated. This year, I converted $XXX from a nondeductible IRA to a Roth IRA and received a 1099-R. The distribution code in box 7 of the 1099-R is 2, which the IRS defines as "Early distribution, exception applies (under age 59 ½)". This was not an early distribution for emergency reasons. I am currently using TurboTax Premier software, which entered entered $YYY as a pension/retirement distribution exclusion on Line 35 of the Form 200-01. I checked with an auditor at the DE Dept of Revenue and they said that I was correct to question it and it should not be counted as a retirement exclusion. I created a TurboTax token for this. For the time being, I will make manual adjustments to the form. Let me know if I've done something incorrect. Thanks in advance for your help and have a good day.

[MaryK4]

If your Box 7 is Code 2, you must contact your IRA to get it corrected, as this is how it is being reported to the IRS and Delaware.

[romakulus]

@MaryK4 , thanks for the quick reply. The amount is displaying correctly on my 1040. It says the IRA distributions (line 4a) are $XXX and the Taxable amount (line 4b) is $0, so the federal form is correct. I double-checked online and the code 2 in box 7 of the 1099-R seems to be correct for the type of distribution that was made and the federal form did not have an error on it (source: https://ttlc.intuit.com/community/retirement/discussion/how-to-report-backdoor-roth-in-turbotax-usin...)

However, the DE state form is not processing it correctly.

[MaryK4 · Accepted solution]

You can go back to the Delaware tax form and look for the screen below to adjust the exclusion.  Thanks for the clrification!

@romakulus

[Slicedogg]

I need to correct my birthday