Taxable amount rolled over for 1099-R not calculated correctly by Turbo tax 2024

[JoAnnNB]

Hi,

I have received 1099-R for 2024 for rolling over $53750 from an after-tax 401k account to a Roth IRA. I contributed $53430, so the gain of $320 is taxable.

In 1099-R,

Box 1: $53750

Box 2a $320

Box 5 $53430

Box 7 G

In step by step Tax entry, I selected Yes to the question "Was this Money Rolled Over to a Roth IRA?"  and Yes to the question " Did you make after-tax contribution to this 401(k) or 403(b) plan" and entered "$53430" as the amount I contributed. Although I don't know if Turbo Tax actually retains the answers to these two questions as every time I open this 1099-R Entry to check, these two seem to have the default "No" ansswers.

However, in 1099R Summary form,
line 26 (Taxable amount in box 2a, Form 1099-R) shows 320, which is correct
line 26a (Taxable amount rolled over) incorrectly shows 0 instead of 320
line 31 (Taxable amount of Roth IRA conversions) shows 320
line 321 (Taxable amount of distributions) shows 640 instead of 320

In 2023, I have a similar situation and the line 26a was calculated correctly. How can I fix this issue without overriding line 26a? I believe I won't be able to efile if I override it.

Your answer would be greatly appreciated.

JoAnn

[JoAnnNB]

I found in 1099-R Additional Distribution Information, B1 (Check if the entire distribution rolled over) is checked, so my entry in Step-by-Step was retained correctly, but somehow the info was not reflected in Line 26a.

I checked my 1099-R entries for 2023, all my entries in 2024 are done the same way as 2023 for 1099-R and 1099-R Additional Distribution Information, but the 1099-R Summary for 2024 calculated 26a differently than 2023 for some reason. Maybe there is a new software bug?

[JoAnnNB]

This appears to be a Turbo Tax bug. I spoke to Turbo Tax support and the person agreed with my assessment. In order to correct this software error, I have to override 26a on 1099-R Summary from blank to the amount that was rolled over. As a result, I don't seem to be able to e-file.

Is there a way I can correct this error and still be able to e-file?  

Thanks

[DanaB27]

I tested this and it seems it was fixed. I'm showing $320 on line 26a.

@JoAnnNB 

[JoAnnNB]

Hi, @DanaB27 :

Thank you for the reply. 

I installed the latest TurboTax update, removed the over-ride of 26a, but I still got the same issue. I then tried additional testing by adding a second  test1099-R form that has identical info as the original one just in case the calculation only applies to a new entry. However I saw the same issue with both entries as shown below.

Do you have any suggestion on what else I can try or how I may further debug this problem?  

Here is the info on 1099-R Additional Distribution Information,

Thank you,

JoAnn

[SteamTrain]

If you are still working on it..

I tried one (Windows 11 Desktop Premier) with 50,222 distribution and 50,000 after-tax contributions (222 taxable) and it worked OK for me.   (with latest update rev 024.000.0355)

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One thing you could try.......is to open the 1099-R Summary again in Forms Mode.

Then go to the bottom of the window and select  Delete Form.

That will delete the 1099-R summary, but then it will immediately regenerate it.

Open that 1099 Summary again and see if it's still wonky.

________________________

Beyond that, I'm clueless.

Perhaps delete every 1099-R you have and re-enter that one manually.  Don't import from the provider. Don't upload a picture of it or a PDF file of it.  Enter it all manually.   (Just a wild longshot)

[JoAnnNB]

Hi, @SteamTrain:

Thank you for the reply!  As suggested, I tried deleting 1099-Summary. A new one was generated but it has  the same result. Then I deleted the only 1099-R in the original tax file and manually entered a new one. Somehow, I still got the same incorrect outcome.

In case I entered something different from yours, I captured my step by step entries as well as my SW version. Please take a look and let me know if I missed anything. (c.c. @DanaB27 ). Thank you!

[JoAnnNB]

Looks like one of the pictures was not uploaded successfully, here is it :

[SteamTrain · Accepted solution]

@JoAnnNB @DanaB27 

OK...this is the strangest error I've ever seen.

I repeated your problem exactly...the cents parts were critical.

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THEN....I did notice one thing....

The value of two boxes of the 1099-R must add up to 53749.50 (as long as box 1 is correct).

....but...they add up to 53749.60   not xxxxxx.50

1)  So...changing box 2a to 320.26 results in the 320 being properly entered on line 26a of the 1099-R Summary, and an "ALMOST" correct $321 being posted to line 5b of the form 1040.  (rounding issue?)

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2)  (Removed..not quite correct 2nd part)

_________________

Thus I suspect a strange issue in the behind the scenes calculations, that somehow detects the 10cent error that results in nothing being placed in line 26a of the 1099-R Summary sheet (should be $320)

_____________________

What to do?  I would just go ahead and set box 2a of the 1099-R to 320.26 and if that works for you too, then move on. Yeah, your line 5b of the 1040 is $1 too high at $321......you can probably live with that. 

 (whole bunch of rounding nonsense going on)

_________________

@DanaB27 

I've seen a number of posts this year where people are porting similar issues  (A doubling of the 1099-R, box 2a taxable amount).....Perhaps they have some subtle mis-## entry issues too.

...but shouldn't be that drastic for 10 cents screwing up the entire 1099-R Summary worksheet??

[SteamTrain]

Deleted...never mind

[JoAnnNB]

Hi, @SteamTrain:

You are amazing! Yes, that was the exact cause. Box 1 should be entered as $51749.60 instead of $51749.50. I missed that small error. I thought Turbo Tax rounds the numbers, so the cents wouldn't matter esp. if they rounded up to be the same. But as you suspected, the $0.10 difference must have triggered a hidden issue in TurboTax. The issue probably was there last year, but my entries with other correct 1099-R numbers didn't trigger it. 

If Turbo Tax could add a change to alert user of such discrepancies for the user to catch and correct the data error, it would be nice. (c.c. @DanaB27 )

Thank you very much for investigating this issue!  Although I have already filed my tax by mail as I don't know when this issue would be resolved, I am so glad to know the cause! Next year, I can avoid a similar issue and hopefully be able to eFile again.

JoAnn