Level 6

Question

Roth IRA Distribution

Forum|Forum|3 years ago
March 19, 2023
4 replies
30 views

My client is 63 years old, took out $8,900 from Roth IRA which he invested for more than 5 years. On form 1099-R, distribution code is T. Why is it included in his income ? Do I need to do something in ProSeries so it's not taxable ?

Thanks,

ProSeries Basic

This topic has been closed for replies.

SensibleandHourly

Level 6

Perhaps have your client check with the financial firm that created the form? Either there is a legitimate reason for that code that is not clear or perhaps simply an error? Either way, the financial firm is likely able to clarify.

Just-Lisa-Now-

Intuit Community Champion

Youre sure its appearing as taxable income on the front of the 1040? When I input a Code T, it doesnt show up as taxable.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

C

ChiHoangAuthor

Level 6

Yes code T, distribution shows up on line 4a and 4b. I'm working with ProSeries Basic.

Thanks for your quick response

T

Terry53029

Intuit Community Champion

put a code Q in box 7

C

ChiHoangAuthor

Level 6

On 1099-R, it's code T. Do you suggest me to change it to code Q ? But IRS has code T, will it cause any problem ?

Thanks

SensibleandHourly

Level 6

following......

qbteachmt

Level 15

"which he invested for more than 5 years."

That's not how the various 5-year rules are stated, though.

I recommend investopedia articles, such as:

https://www.investopedia.com/ask/answers/05/waitingperiodroth.asp

Once you confirm everything about this scenario is qualified, you would use the applicable code and not the code from the 1099-R. Remember that the issuer only knows about the distribution, really. They don't know the entire event that transpires. For instance, they won't know about indirect rollovers.

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C

ChiHoangAuthor

Level 6

Got it. Thank you so much.

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