401k rollover into IRA, TT asking to fill out Form 5329, line 7

[kd46]

TT won't let me e-file unless I fill out this entry. I did not contribute excess last year. I was laid off and needed to rollover my 401k (previous employer) into a traditional IRA (NOT Roth). The amount that I rolled over was more than 7k.. After Googling, I know excess limits for married filing jointly were 7k but that's all I could find. Do I just ignore this and mail it in since TT won't let me e-file without entering in 7k?

[JohnB5677]

Return to the 1099-R input screen and check your posting.

Log into TurboTax

1. Under Federal
2. Select Wages & Income
3. Scroll to and select IRA, 401(k), Pension Plan Withdrawals (1099-R)
4. Select the pencil next to the rollover
5. [Continue]
6. You should see the 1099-R record [Continue]
7. Is the IRA/SEP/SIMPLE box on this 1099-R checked? NO
8. Where is your distribution from? None of the above
9. What kind of retirement plan do you have with XXXX? Qualified plan
10. Do any of these situations apply to you? None of these apply
11. How much of the $X,XXX was an RMD? None of this withdrawal was an RMD
12. This is the key line:
13. Tell us if you moved the money through a rollover or conversion
14. I rolled over some or all of it to an IRA or other retirement account within the time limits (normally 60 days)
15. Continue the interview to the end.

You should no longer require Form 5329

[dmertz · Accepted solution]

You are getting this message either because you reported an excess IRA contribution on your 2023 tax return or you told 2024 TurboTax that you have excess contributions in your traditional IRAs from years prior to 2024.  Check to see if on your 2023 tax return you mistakenly reported a 401(k)-to-IRA rollover as being an IRA contribution and amend your 2023 tax return if necessary.  Assuming that you truly have no excess contributions from years prior to 2024, you'll need to correct the information in 2024 TurboTax where TurboTax asks if you have such excess contributions.  You'll do this in the Traditional and Roth IRA Contributions section of TurboTax under Deductions & Credits.

[kd46]

This was it.. You'll do this in the Traditional and Roth IRA Contributions section of TurboTax under Deductions & Credits. I don't know what I did to trigger TT to enter $ into this section but once I cleared it, I was able to file. Thank you so much for your quick and helpful responses!!

[dhoyas2002]

I do not get options  of steps 8 on .   After step 7 It ask  to verify box 2A and  2 B.  Next question is did I roll over to a roth  401K.  Was this money rolled over to a Roth IRA.  There is not a question of if this was rolled to a traditional IRA.   Where am I supposed to enter I rolled the funds over so it does not count as income.

[dmertz]

When you answer that it was not rolled over to any kind of Roth account, a code-G Form 1099-R is automatically treated by TurboTax as indicating a rollover to a traditional account.

[JeanneG]

When it assumes it is a rollover to a traditional IRA, should the amount be considered income?

[VolvoGirl]

No a rollover to a Traditional IRA is not taxable.  What code is in box 7?

 If you are looking at a summary screen or review screen those show the full amount as income and lump a lot of stuff together. You need to check the actual 1040 and make sure it’s right. For 1099R check 1040 line 4a/5a and 4b/5b for any taxable amount. If it was a rollover it should say ROLLOVER by the “b” line and 0 taxable.