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Troubleshooting Lacerte diagnostic ref. 19622- PA Return has federal 1099-R income in

by Lacerte Tax 2023 Updated 7 months ago

The following diagnostic is generating for any Individual return with 1099-R income that includes a Pennsylvania return:

  • This return has federal 1099-R income that may be taxable in Pennsylvania. To carry taxable amounts and withholding to Form PA-40, 1099-R information must be entered on the Pennsylvania "Miscellaneous Compensation" screen (detail screen 50.051). (ref. #19622)

Why is this diagnostic generating?

The diagnostic was added due to the following information provided in the instructions for PA-40.

If you withdrew from your retirement or pension plan and received a Form 1099-R, you may have PA-taxable compensation if:

  1. Your retirement plan is not an eligible Pennsylvania retirement plan; or
  2. If you have not reached the retirement age or years of service requirements under such eligible Pennsylvania retirement plan.

How do I resolve this diagnostic?

If the 1099-R is taxable to PA, follow these steps to include it as Gross Compensation:

  1. Go to Screen 50, Income.
  2. Select Pennsylvania Income from the left navigation panel.
  3. Enter the income from the 1099-R in the Gross compensation (Ctrl+E) field.
Lacerte Tax

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