Got a 1099-R for Traditional IRA to Roth IRA distribution

Forum|Forum|3 years ago
February 11, 2023
2 replies
0 views

The 1099-R has my full distribution amount as "taxable amount" in Section 2A and has Distribution Code "2" with IRA / SEP checked off.

I already had a basis equal to this distribution in my Traditional IRA account so converting it into a Roth IRA should not be a taxable event. Should I just enter 0 for the taxable amount portion when I enter my 1099-R details manually? or is there another way to do this?

Best answer by MAK70

You should enter the 1099-R as it is (with the 2A taxable amount). In the follow-up questions, TurboTax will ask you if you had nondeductible contributions to your IRA- it is here that you can enter the total to show it is not taxable and get it reported on the correct forms.

MAK70Answer

Carl11_2

Employee

converting it into a Roth IRA should not be a taxable event.

Converting a traditional IRA to a ROTH *is* a taxable event. If you are under retirement age, then the withdrawal from the traditional IRA will be taxable. It will not be subject to the 10% early withdrawal penalty if you converted it to a ROTH.

If the administrator of the Traditional IRA were required to withhold any amount and did so, then it's up to you to make up the difference in order to be credited for converting the entire withdrawal amount.