Understanding 401k Rollover 1099-R Distribution Code for Pre-tax vs Roth Accounts

The distribution codes on 1099-R forms are super important as they tell the IRS exactly what type of distribution occurred. For 401k rollovers, you typically want to see code G (direct rollover) or code H (direct rollover to a designated Roth account). For your pre-tax rollover, I'm guessing you see code G which is normal. For the Roth portion, you might be seeing code H, or possibly a combination like "G" with "J" (early distribution, no known exception). Don't panic though - if you did a proper direct rollover from Roth 401k to Roth 401k, even if the code looks concerning, it shouldn't create a taxable event. What's crucial is that you properly report both 1099-Rs on your tax return. The IRS will be matching these documents with your filing. Most tax software will ask you specific questions about rollover transactions to ensure they're coded correctly on your return.

After getting super confused about 401k rollover distribution codes myself last year, I found this amazing tool called taxr.ai (https://taxr.ai) that helped me figure everything out. I uploaded my 1099-R forms and it analyzed all the distribution codes and explained exactly what they meant for my tax situation. What I really liked is that it explained the correct way to report my rollover in TurboTax so I didn't accidentally pay taxes on money that should have been tax-free. The tool even pointed out that my plan administrator had used the wrong code on one of my forms and showed me how to properly report it anyway.

Just wanted to update - I tried taxr.ai after seeing it mentioned here and it was seriously helpful with my complicated rollover situation! I uploaded my 1099-Rs which had similar weird distribution codes, and it immediately identified what each code meant and why my plan administrator had chosen those specific codes. The best part was it showed me exactly how to report everything in TurboTax with screenshots of which boxes to check. It confirmed that my Roth rollover wouldn't be taxed despite having a distribution code that usually indicates a taxable withdrawal. Feeling much more confident about my tax filing now!

If you're still confused after trying to sort this out yourself, you might want to try calling the IRS directly for clarification. I know, I know - getting through to an actual human at the IRS seems impossible. I spent HOURS on hold trying to get an answer about my own 401k rollover issue last year. Then I discovered this service called Claimyr (https://claimyr.com) that got me through to an actual IRS agent in less than 45 minutes. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c. They basically navigate the phone system for you and call you back when they've got an agent on the line. The IRS agent I spoke with confirmed that despite the weird distribution code on my 1099-R, my rollover was non-taxable as long as I reported it correctly. They walked me through exactly how to document it on my return.

I need to eat my words about Claimyr. After my skeptical comment, I decided to try it since I've been trying to get through to the IRS about my own 401k rollover issue for over two weeks with no luck. I was absolutely shocked when I got a call back in about 40 minutes with an actual IRS agent on the line. The agent confirmed that my Roth 401k rollover with distribution code J was still non-taxable since it went directly to another qualified account. They explained exactly how to report it on my tax return so it wouldn't trigger an audit. Really didn't expect the service to work, but it saved me hours of frustration and hold music. Just wanted to update since my previous comment was pretty negative.

Something similar happened to me with my rollover last year. My Roth 401k distribution had code J, but my tax advisor said it's actually common for plan administrators to use that code even for direct rollovers of Roth accounts. The key is how YOU report it on your tax return. When you input the 1099-R information, you'll need to indicate it was rolled over. In most tax software, there's a specific question about whether the distribution was rolled over to a qualified account. When you answer "yes," the software handles the rest and properly reports it as non-taxable. Just make sure you actually did a direct rollover (plan-to-plan) or completed the 60-day rollover window if you received a check. That's what determines the tax treatment, not necessarily what code appears on the 1099-R.

Curious - did u receive any tax forms from the new 401k provider showing the incoming rollover? When I did mine, I got 1099-Rs from my old plans but nothing from the new one that received the $$.

I went through this exact same situation last year and was totally confused by the distribution codes too! What really helped me was understanding that the code on the 1099-R doesn't always perfectly match what actually happened - it's just the plan administrator's best guess at categorizing the transaction. For your Roth rollover, even if you see code J (early distribution, no known exception), it doesn't mean you'll owe penalties if you did a proper direct rollover. The key is how you report it on your tax return. When you file, you'll need to indicate that this was rolled over to another qualified plan, which will make it non-taxable regardless of the distribution code. I'd recommend keeping all your rollover documentation (confirmation letters from both plans, transfer forms, etc.) just in case. The IRS cares more about the actual substance of the transaction than the specific code your old plan used. As long as you can show it was a legitimate rollover, you should be fine!