Form 8880 Bug

Forum|Forum|6 years ago
January 25, 2020
1 reply
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Hello,

I entered several rollover forms from 1099R this year. Three of the forms had box 7 checked as G, and so TurboTax appropriately didn't include them on form 8880 line 4. One of them (a ROTH) instead had box 7 as type 1, but I indicated to the software (during the follow up questions) that I rolled it over to another retirement account (I redid it just to make sure). The software incorrectly included this rolled over money on form 8880 line 4.

Best answer by dmertz

I suspect that the code 1 Form 1099-R is for a distribution of after-tax money from a traditional 401(k) account and this money was rolled over to a Roth IRA (part of a split distribution with the pre-tax money being directly rolled over to avoid mandatory tax withholding and the after-tax money being indirectly rolled over). Because it was all after tax (Box 5 = box 1 and box 2a = $0), this rollover was nontaxable.

As far as I can tell, when entered properly by indicating that the entire amount of this distribution was converted to Roth, TurboTax does not include this distribution on Form 8880 line 4. The test return that I prepared behaved properly in this respect.

BunnyGoAuthor

Level 3

In case it matters: Box 5 correctly has the entire value of the account (it's the same as Box 1). Box 7 is listed as 1, which seems wrong to me...shouldn't it be B? Even so, I told turbotax that the money was rolled over by me.

macuser_22

Alumni - Champ

A code G rollover is not cash distributed to you so it should not be on line 4.

A 1099-R with a code "1" only in box 7 indicated that the account is NOT a Roth. A code "B" is a distribution from a designated Roth (a 401(k) Roth) and might also have a code 1. A direct rollover of a designated Roth to a Roth IRA should have a code "H".

Box 5 indicates that the box 1 amount is your contributions. Are you sure that the box 7 code is not "1B", not just "1"?

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**