Roth Distribution

[Foolishtom]

Hello, confused why a $3,000.00-dollar ROTH distribution with a "T" in box 7, for someone 72 years old, is possibly going to be taxed? 

[Critter-3 · Accepted solution]

The 1099-R must be entered into the program and the distribution will show in the income summary however if you answer the follow up questions in that area correctly it will not be taxable on the return.  Please review the form 1040 carefully ... note the distribution on line 4a and any taxable portion on line 4b. 

[Foolishtom]

Critter,

Thank you very much! I checked the 1040 as you said, Line 4b does not show any tax due on that 3K Roth distribution. 

As an aside, if the person is working and has an employer sponsored 401K, she does not have to take RMD's from her current employer plan, correct?

Again, thank you, Critter.

[dmertz]

Addressing the reason that the Form 1099-R has code T instead of code Q, the Roth IRA custodian is using code T to indicate that they do not know the year for which you first made a Roth IRA contribution.  Telling 2022 TurboTax that you had a Roth IRA prior to 2018 causes code T to be treated the same as code Q.  If instead it has been less than 5 years since the beginning of the year for which you first made a Roth IRA contribution, the taxable amount of your Roth IRA distribution is calculated on Form 8606 Part III.

[Critter-3]

@Foolishtom 

As an aside, if the person is working and has an employer sponsored 401K, she does not have to take RMD's from her current employer plan, correct?   CORRECT

[Foolishtom]

Critter-3,

Thank you for that. I found a good article on Forbes also. 

Your help is much appreciated,

Thanks Tom

[Foolishtom]

Thank you.  Putting your explanation and Critter -3's together gives me a better understanding. I see both points. Thank you.

Regards,

Tom