In plan conversion from 457b to Roth IRA

Forum|Forum|2 years ago
February 2, 2024
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Hi, I am using Turbotax Deluxe 2023.

I did an in-plan conversion from a 457b account to Roth IRA. I received a 1099R in January, where Box 7 has G-Direct Rollover and Rollover contribution selected.

Since this was an in plan conversion, taxes were not withheld. But I understand that I have to pay taxes at this time. My question is how to enter the information correctly in Turbotax.

1) On the menu that reads Rollover of 401(k) to Roth 401(k) do I select, Yes, this money rolled over to a designated Roth 401(k) or 403(b) account OR do I select No, this money didn't roll over to a designated Roth 401(k) or 403(b) account

If I say yes on this screen, I am done. But if I say No, they I get another screen that says, For rollovers to a Roth IRA, we may need to collect some additional info. For rollovers to all other types of retirement accounts (such as a traditional IRA), just answer No.

I believe that on the first of these 2 screens, I should answer Yes. Is this correct?

Best answer by dmertz

Correct. You did not do an in plan conversion to a Roth IRA, you did an In-plan Roth Rollover to the designated Roth account in the 457(b) (which is not an IRA). Even though the TurboTax developers failed to mention 457(b) in the question that asks if was rolled over to a Roth 401(k), answer Yes to that question. The rollover was not to a Roth IRA.

dmertzAnswer

Employee

Y-X-A-2Author

Hi, thank you for your answer.

I will answer Yes on that question in Turbotax because it's the only thing that makes sense. It's confusing, because my deferred comp plan, when they sent me the form to fill out refer to this as a Roth In-Plan Conversion.