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April 1, 2024
Question

If I rolled over my 401k from one employer to another while also taking a distribution, do I enter the amount of the distribution in the Other Reason field?

  • April 1, 2024
  • 1 reply
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April 9, 2024

To clarify. are you referring to the "These situations may lower your tax bill" screen? 

 

If the exception applies to you then you will enter the amount that was distributed to you and this will be carried over to line 2 of Form 5329. The rollover amount isn't included on Form 5329 line 1 and 2.

 

From the Learn more FAQ:

 

"If you made an early retirement withdrawal for any of the following reasons, enter the dollar amount of the withdrawal next to Other Reason. You may not need to pay an additional 10% in taxes on the money you took out. See a list of exceptions.

 

  • You were older than 59 ½ when you made the withdrawal.
  • You withdrew the money from:
    • A section 457 plan that you didn't roll over from another qualified retirement plan.
    • Employer Stock Ownership Plan (ESOP) employer stock dividends.
    • A single-purchase annuity that provides equal payments at least once a year (the equal payments must begin within one year of the annuity purchase).
    • A deferred annuity contract.
  • You withdrew the money under a qualified domestic relations order, to split it with your spouse or former spouse.
  • The retirement plan was maintained by a previous employer, and you stopped working for the employer by March 1, 1986 (see more info below).
  • You had a qualified 8915-disaster distribution in 2020 (including Covid-related distributions).

If you took money out for a different reason that isn't covered here or on another screen, you'll owe additional tax. This is true for most people who take money out of a retirement account before age 59 1/2.

Select Continue when finished, and we'll let you know how this changes your taxes."

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