1099-R Coded J

[Amanda44]

First off, hope everyone is surviving tax season! Only a few more days, which is good and bad!

I need some assistance - I have a client that received a 1099-R coded J - Early Distribution from Roth IRA. When I enter the 1099-R like it was reported, it's showing the whole amount as taxable. Her contributions were about $69k - how do I show that? She's spoken with her financial advisor and they said the 1099-R is correct and that it's on me to show that the whole amount is not taxable. Some back story - she took the money out to buy out her now ex from her portion of the house they owned jointly.  Any help would be greatly, greatly appreciated.

[qbteachmt]

Their own contributions are Basis; that gets entered on Form 8606. You didn't state if they took more than this amount. Roth has distribution ordering rules. Also, there are three different 5-year rules (account of this type open at least 5 years, conversions left in at least 5 years) and there is code J for early distribution = under age 59 1/2. That means Form 5329 for penalties. There are some exceptions.

https://www.irs.gov/taxtopics/tc557