1099-R code 1 distribution no excess tax

Forum|Forum|2 years ago
February 7, 2024
1 reply
13 views

Hi all

Client receives 1099-R for $5k code 1 in box 7. Client is 55. Have entered basis of $4,800 from 2022 as no deduction was taken.

Proseries flows the $200 through to 1040 as taxable. No additional tax or 10% penalty. Does this sound correct? I can understand post tax in, post tax out, but thought code 1 for younger than 59 1/2 would charge the penalty.

Any help much appreciated

Nolan

ProSeries Professional

This topic has been closed for replies.

Best answer by dkh

Yep, Sounds like you got it figured out

qbteachmt

Level 15

What account/plan type? For instance, Roth, and open at least 5 years? And is this a full distribution? If an employer plan, is this person who is 55 now separated from that employer?

A billion details would be helpful.

Don't yell at us; we're volunteers

N

nolanmAuthor

Level 5

Hi thanks for the help

Regular IRA. Client tells me she contributed post tax 6 years ago. There was no 401k at her employer so set up personally with Ameriprise. In 2023 she ask for a full distribution. 1099-R was generated and 10% Federal and State tax was withheld. 1099-R shows $5k in box 1, and box 3 (taxable amount) but box 2b is checked as taxable amount not determined.

Have a separate form 5498 from 2022 that shows fair market value end 2022 at $4800. I think my error is that I entered this $4800 as basis for 2022 in the IRA info worksheet which is why only $200 was flowing through to the 1040 as taxable. Fair market value from the 5498 from 2022 should just be ignored correct? If I omit this basis the full $5k is taxable which makes more sense?

dkhAnswer

Level 15

Yep, Sounds like you got it figured out

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