How did you answer the follow up questions after entering the 1099-R?
After I put in the info, it said I didn't owe taxes on the money that I had transferred from a traditional IRA to a ROTH. That isn't right. The 1099-R did have a "2" on line 7 with the IRA/SEP/SIMPLE marked. I don't know why though. I read the qualifications for this and I don't think any apply to me. After that, it was a NO for employer matching contribution question. I'm retired. It was a NO for inheriting it from broker. What did you do with the money? I moved the money to another retirement acct. I rolled over all the money. Then it confirms I won't have to pay taxes on the money. It's $45,000 that I rolled from a traditional to a roth! It was showing over 4k in taxes before going through the whole process. Am I not reading some of the rules right and I really am exempt from these taxes?
Delete the 1099R and try entering it again manually. Could it be saying you don't owe any extra taxes on it? Like the 10% Early Withdrawal Penalty? Did you check the actual 1040 line 4b for the taxable amount?
Oh it is NOT a rollover. It is a Conversion.
Pick I moved it to another retirement account. Then it will ask if it was to a ROTH.
Then choose - I did a combination of rolling over, converting or cashing out the money
Then it will ask how much you converted to a ROTH
It is code 2? That is for early distribution for under 59 1/2. How old are you? You said you are retired? You might need a corrected 1099R.
It is a code 2. I am 50. I swear I paid taxes doing the same exact thing last year, though. Thoughts? Does this mean I won't have to pay taxes on this money ever?
You do owe tax on it if you converted a Traditional IRA to a ROTH IRA. Delete the 1099R and try again. Did you check 1040 line 4b? It should be there. You didn't roll it over. You converted it. Check the questions again.
This worked and it put the taxes back. I think I'm good now. I'll let you know. Thx, VolvoGirl!
One more question...
Is the Roth conversion I've been talking about different than a contribution? I've already accounted for this conversion, so when it's asking me if I've made a Roth contribution or excess Roth contribution, I should put no...correct?
Right. A Rollover or Conversion is NOT a new contribution. Do not enter it under Deductions again.