Question

TT not allowing credit for IRA contribution which was a return within 60 days of the withdrawal.

Forum|Forum|4 years ago
March 16, 2022
2 replies
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We withdrew in 2021 from an IRA. We made a replacement deposit to that same IRA within sixty days of the withdrawal. The 1099R shows the gross amount of the withdrawal. When I enter in the IRA contributions area the amount we put back, TT says that we can't receive credit (ie reduction in tax liability) because our AGI is too high.

Irrespective of our earning/AGI, we should be allowed to reduce the IRA withdrawal by putting back amounts before sixty days expires. How do we get credit for the put back amount?

Should've the IRA custodian reduced the 1099R by the put back? If I enter the net amount (withdrawal less put back) in the 1099R entry, wouldn't that raise flags with the IRS?

Please help.

TurboTax Home & Biz Windows

DoninGA

Employee

Returning the IRA distribution within 60 days is not a contribution to an IRA.

D

dmertz

Employee

Nothing about these transactions is to be entered under Deductions & Credits. Remove the entry you made there.

What you did was a distribution and rollover. The Form 1099-R is correct. When you enter this form, indicate that you moved the money to another retirement account (or back to the same account), then indicate as a rollover the amount that you put back. TurboTax will include the entire distribution on Form 1040 line 4a but exclude from the taxable amount on line 4b the amount that you put back. TurboTax will also include the ROLLOVER notation next to this line.