turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Event: Ask the Experts about your refund > RSVP NOW!
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

xorxor
New Member

Confusing question on Turbotax 2023 about form 1099R

In 2023 I did a Roth IRA conversion by cashing out a portion of my IRA with federal and state tax withheld.   Then I contributed all this money to a Roth IRA.

 

On Turbotax 2023, I found the following question confusing:  

What did you do with the money from Charles Schwab?  (my brokerage)

* You moved the money to another retirement account 

* You did something else with it (cashed out, etc)

When I choose the first answer, on the next screen the following is stated: "You wont' have to pay tax on your $60,000 rollover".   Strange!  So where is the answer choice if I did a Roth IRA conversion?   Looks like there is no other than to choose cashed out.   And after that you are asked if you contributed the cashed out money to an HSA account.   There is no obvious place where you are asked if you did a Roth IRA conversion.

 

Does anyone know if TurboTax actually asked that question, and if so, where?

Connect with an expert
x
Do you have an Intuit account?

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

3 Replies
DanaB27
Expert Alumni

Confusing question on Turbotax 2023 about form 1099R

In TurboTax Desktop on the “What Did You Do With The Money” screen you will get the following options: 

  •  I moved it to another retirement account
  • I did something else with it (cashed out, etc)

When you click on "I moved it to another retirement account" the screen will open up with more choices. Here you can choose “I did a combination of rolling over, converting, or cashing out money.” and enter the amount next to "Amount converted to a Roth IRA account"

 

 

If you do not get this screen you might have to delete your Form 1099-R entry and reenter it.

 

  1. Click on "Search" on the top right and type “1099-R”  
  2. Click on “Jump to 1099-R”
  3. On the "Your 1099-R Entries" screen click the "Trash icon" to delete the Form 1099-R
  4. Click "Add Another 1099-R" to reenter the Form 1099-R

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
dmertz
Level 15

Confusing question on Turbotax 2023 about form 1099R

TurboTax's message about not being subject to "additional taxes" refers to the early-distribution penalty that is avoided on a code-2 distribution.

 

This sounds like an incorrectly prepared Form 1099-R.  A Form 1099-R with code 2 in box 7 and the IRA/SEP/SIMPLE box marked is not permitted to have any amount shown for tax withholding.  When the recipient is under age 59½, tax withholding is required to be shown on a separate code-1 Form 1099-R.

 

If you substituted other funds for the portion withheld for taxes, resulting in all $60,000 reaching the Roth IRA, just report the code-2 Form 1099-R as received and indicate that the entire $60,000 was converted to Roth.  Otherwise, request corrected Forms 1099-R from the payer, splitting the amount between code-2 and code-1 Forms 1099-R.

Confusing question on Turbotax 2023 about form 1099R

I don't think you contributed to a new Roth IRA, I think you did a rollover.  This is a nitpick, but an important one, since contributions are limited to $7000 or $7500 in 2023.  If it was a contribution, or was recorded as a contribution by the new IRA instead of as a rollover, you have a much bigger problem.  

 

Then, did you rollover the entire $60,000 (making up the difference due to withholding from other funds) or did you only rollover the net amount.  If you only rolled over the net amount, then you have a partial withdrawal and a partial rollover.  You would select "I did something else" with the money and then you will have a chance to enter the rollover amount and the kept (withdrawn) amount.  Only select "rollover" if you rolled over the entire $60,000 by making up the withholding from your other funds.  

 

I agree that either the 1099-R used the wrong code, or maybe you entered it incorrectly, assuming it was a fully pre-tax IRA being converted to a Roth IRA. 

message box icon

Get more help

Ask questions and learn more about your taxes and finances.

Post your Question
Manage cookies