Pre tax 401k rollover to Roth

[gferlin]

I rolled my company's pretax 401K balance to a Roth IRA.  The trustee issued a 1099r showing zero taxable in box 2a and code G in box 7.  I asked the trustee to issue a corrected 1099r with the full amount in box 2a and distribution code 2 in box 7 and they refused.  I keep getting advice to not change the fields from the 1099r while entering in TurboTax.  So how do I record this information in TurboTax so that I pay the appropriate tax on the conversion?  I have gone through the questionnaire on what I did with the money and selected the radio button that I put it in a Roth, but the tax due is not updating.

[macuser_22]

A code G with box 2a zero indicated a rollover to a Traditional IRA.    If they issued a check then it should have been made out to your Traditional IRA and the IRA custodian should never have put it in a  Roth.

However, all you can do at this point is to choose the "Substitute 1099-R" form type and enter exactally as your 1099-R is but make box 2a the same as box 1.    Answer the rollover to a Roth IRA question yes.

Enter a statement that you are using a substitute because the money went to a Roth and not a Traditional IRA and the issuer refused to correct the 1099-R.

Unfortunately a tax return with a substitute 1099-R cannot be e-filed and must be printed and mailed.

[gferlin]

Thank you.  I figured I would do the substitute as a last resort.  I thought maybe there was an issue with how the software populates.  When I click the radio button that I put the money in a Roth, TurboTax knows it is more income as it takes away the investment tax credit that was there pre-1099r entry, it just doesn't add the tax due on the rollover.

Obviously, I'm not working with a customer focused trustee.  They made the check out to "New Trustee FBO: My Name", so it wasn't restricted to a traditional IRA roll over account.  That was a good thing.  It was like pulling teeth to get this money out of them.  Started in November and kept calling looking for it; the check arrived in the afternoon mail on Dec 31.  Just barely made it for a 2020 conversion.

[macuser_22]

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@gferlin wrote:

Thank you.  I figured I would do the substitute as a last resort.  I thought maybe there was an issue with how the software populates.  When I click the radio button that I put the money in a Roth, TurboTax knows it is more income as it takes away the investment tax credit that was there pre-1099r entry, it just doesn't add the tax due on the rollover.

A zero in box 2a makes is not taxable.     If you are converting after-tax money in a 401(k) to a Roth, the after-tax contributions would be in box 5 on the 1099-R, so box 2a would be the box 1 amount minus the box 5 after-tax money which could make box 2a zero if all after-tax money.