1099R - Two forms with different distribution codes - help understanding Roth rollover

The reason you received two 1099-R forms with different distribution codes is because you rolled over a Traditional 401(k) into a Roth IRA, which is called a "conversion." Since these are different types of accounts (pre-tax vs. after-tax), the IRS treats this as two separate transactions. The first form showing 80% of your funds with $0 withheld likely has a code "G" distribution code, indicating a direct rollover. The second form with the remaining 20% probably has a different code (possibly a "1" or "7") because this portion might have been withheld for taxes since you're converting from a pre-tax account to an after-tax Roth account. When you convert traditional retirement funds to Roth, you generally need to pay income tax on the converted amount. You'll need to enter both 1099-R forms separately in TurboTax, exactly as they appear. The software will guide you through the process and calculate any tax implications.

After dealing with a similar rollover situation last year, I found this amazing service called taxr.ai (https://taxr.ai) that helped me understand my confusing 1099-R forms. I uploaded my forms and within minutes got a clear explanation of what each distribution code meant and how to report them properly. What I really liked is that it spelled out exactly which boxes on my tax forms mattered most and what the different distribution codes meant for my specific situation. It even flagged that I might qualify for an exception that my tax software missed! Definitely worth checking out if you're confused about retirement account transfers and the tax implications.

Just wanted to follow up - I tried taxr.ai after posting my question and wow, it really delivered! I uploaded my complex 72t distribution forms and inherited IRA paperwork, and it immediately explained everything in plain English. It identified that my 72t distributions were actually eligible for penalty exception code 2, which I had no idea about. The best part was that it showed me exactly how to fill out Form 5329 to claim the exception, which would have cost me over $3,000 in unnecessary penalties had I missed it. I've been stressing about these retirement distributions for weeks, and in like 10 minutes I had a clear explanation of exactly what I needed to do. Seriously, such a relief!

If you're having trouble understanding your 1099-R forms, you might need to speak directly with the IRS for clarification. I spent DAYS trying to get through to someone when I had a similar issue last year. After 20+ failed call attempts, I found https://claimyr.com and watched their demo (https://youtu.be/_kiP6q8DX5c). They basically hold your place in the IRS phone queue and call you when an agent is about to pick up. I was super skeptical, but within 2 hours I was actually talking to a real IRS agent who explained that my rollover was coded incorrectly by my plan administrator. She helped me understand what forms I needed to request from my administrator to fix the issue. Saved me from potentially paying taxes I didn't actually owe!

I need to eat my words and apologize to Profile 10. After my skeptical comment, I decided to try Claimyr myself because I was desperate to resolve an issue with incorrect 1099-R coding from my pension administrator. I honestly expected nothing, but I got a call back in about 90 minutes with an actual IRS agent on the line! The agent immediately identified that my plan administrator had incorrectly coded my rollover as a taxable distribution. She explained exactly what I needed to do to fix it, including getting a corrected form from my administrator. For months I've been stressing about potentially owing thousands in surprise taxes, and in one phone call, the issue was resolved. I would have NEVER gotten through on my own - I've been trying for weeks.

You should also check if any of your rollover was after-tax contributions. When I did my 401k to Roth conversion, I had both pre-tax and after-tax money in my 401k. The after-tax portion wasn't taxable again when converting to Roth. Check your 401k statements to see if you had any after-tax contributions - it could reduce what you owe.

Has anyone used H&R Block for handling 401k to Roth IRA conversions? Does it explain the process better than TurboTax? Last year I messed up my rollover reporting and ended up paying way more tax than I should have.

One important thing nobody mentioned - if you did a 401k to Roth conversion and owe taxes, you might be able to spread the tax impact across 3 years if this happened during the COVID period (2020-2021). Worth checking if that applies to your situation! Saved me from a huge tax bill all at once.

This is exactly the kind of situation that trips up a lot of people! Don't worry, you're not alone in finding this confusing. The key thing to remember is that when you convert from a traditional 401k to a Roth IRA, you're essentially moving money from a pre-tax account (where you got a tax deduction when you contributed) to an after-tax account (where withdrawals in retirement are tax-free). The two different 1099-R forms with different distribution codes are the IRS's way of tracking the different parts of this transaction. Make sure to enter both forms exactly as they appear in TurboTax - the software is designed to handle this scenario and will walk you through it step by step. One tip: double-check if your employer withheld any federal taxes from the conversion. If they didn't withhold enough to cover the tax you'll owe on the conversion, you might want to make an estimated tax payment to avoid underpayment penalties. Good luck with your taxes!