Pennsylvania IRA indirect rollover question

Forum|Forum|4 years ago
February 15, 2022
1 reply
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Took an IRA from one bank and 100% rolled over to another IRA, at another financial institution within a week. TT seems fine with federal side, however PA state side showing taxes owed, on money i didn't receive, even though in the section "State code" the "Rollover" option was selected. (should it be something else?)

1099R Box 7 = 1

Any suggestions would be appreciated.

John

Best answer by RobertB4444

The Box 7 code "1" is for an early withdrawal with no exception. Your 1099-R should have had a code "G" in box 7 and no taxable amount in box 2a. I suggest you go back to your financial institution and request a changed 1099-R or you will have the IRS and PA asking for more info.

RobertB4444Answer

Level 15

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Johnny28Author

Level 2

Thanks for reply.

Box 2A does have a taxable amount.

Since this was a indirect rollover and I personally took the check (full amount) to another institution, then redeposited. Should the new institution provide paperwork, proving the said amount was redistributed into a qualifying plan?

DianeW777

Level 15

Thanks for reply. I checked the box and this message is displayed upon review. Since not taxable, this should be ignored?

Thanks again

The rollover must be designated as such on the PA tax return. When you are signed into your TurboTax account, select the State tab. When you are reviewing the PA return you must select the proper information on the screens shown below for your rollover.

As indicated by our awesome Tax Expert @ErnieS0:

PA says: "If you received a distribution from an IRA and rolled the entire distribution (100 percent) into a Roth IRA directly, or within 60 days, the distribution is not taxable income for PA purposes."

@Johnny28