Welcome back! Ask questions, get answers, and join our large community of tax professionals.
cancel
Showing results for 
Search instead for 
Did you mean: 

1099-R box 2a Taxable Amount

ChiHoang
Level 4

My client withdrew $12,726 from a Roth IRA she owns over 5 years, she contributed over the years $10,400, so her gain was $2,326. She got form 1099-R with distribution code J, and I entered in box 2a taxable amount $2,326.  ProSeries picks up taxable amount of $12,726 instead of $2,326. Why ?

Do I do something wrong ? Thanks for your help.

0 Cheers
6 Comments 6
Just-Lisa-Now-
Level 15
Level 15

You need to put in the basis, I think theres a quickzoom button right on the 1099R worksheet if you scroll down.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
Accountant-Man
Level 13

Why is any amount taxable? And why code J?

** I'm still a champion... of the world! Even without The Lounge.
0 Cheers
qbteachmt
Level 15

The 5-year rule you are thinking of is not "that" Roth IRA, but having any Roth IRA open. The next 5-year rule has to do with contributions, and then there is one for conversions.

There are a bunch of rules for Roth distribution, including various 5-year rules:

https://www.investopedia.com/are-roth-ira-distributions-taxable-5220750

*******************************
Don't yell at us; we're volunteers
taxes96786
Level 9

Possibly interest earned that taxes have not been paid on yet.

0 Cheers
ChiHoang
Level 4

Got it. Thank you so much.

 

qbteachmt
Level 15

"Possibly interest earned that taxes have not been paid on yet."

Which is what happens in a Roth IRA when that distribution is not a qualified distribution. Look at the article I linked, to see the various parts that apply. Your taxpayer might have done something not eligible, or you have entered something incorrectly.

*******************************
Don't yell at us; we're volunteers
0 Cheers