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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,
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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.
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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♥¸¸.•*¨*•♫♪
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put a code Q in box 7
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Yes code T, distribution shows up on line 4a and 4b. I'm working with ProSeries Basic.
Thanks for your quick response
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following......
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Changing to a Q will not cause a problem
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"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.
Don't yell at us; we're volunteers
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Got it. Thank you so much.