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Cositas1004 · Feb 19, 2009, 05:14 AM

Hello.. I am a tax prof from Michigan.. Just doing my fatherinlaws taxes and he is a bit
Grim on remembering details.. What I would like to know is what was the rollover amount.. He claims it was 50,000.. I don't know..

This is what the 1099-R shows..

Box 1 Gross Dis - $74,377.30
Box 2a tax amount- $0
$0 federal tax

Total Distribution box checked..

Box 5 - Employee Contributions/Designated Roth IRA contri etc etc- $19,670.77

Distribution Code G

In the bottom it says Annuity Distrubtion.

Again. He rolled over what he thinks or estimates 50,000... he can't remember.. and he said the rest he took out.. claiming it was around 24,000 and then they taxed that..
So from what I just explained on the 1099-R.. Who can help me figure this out.. Was the taxed percentage 20%?

Thank you!

Thank YOU!

KISS · Feb 19, 2009, 08:54 AM

The end of year statements from the bank would include the contributions to another account.

Total distribution was checked, so it's not this one.

ebaines · Feb 19, 2009, 09:54 AM

Distribution code "G" means this was a direct rollover to another qualified plan (i.e. IRA). That's why Box 2a is $0 - this is a non-taxable rollover. You should be able to find a statement from the IRA company that would confirm whether the full $74K was rolled over to them.

If he remembers making a withdrawal that had some income tax withheld - that must have been a different event than what is documented on this 1099-R. Perhaps he received a second 1099-R documenting an earlier withdrawal? Look carefully - if he received two 1099-R's he may have thought it was just a duplicate. I also suggest you look through his account statements to see what happened - that would make it clear how much the withdrawals were. And yes, if federal income tax is withheld on a distribution it is typically 20% (no state income tax is withheld).

Cositas1004 · Feb 19, 2009, 11:30 AM

Okay.. I see what you are saying..

but he says that when he rolled over X amount he also took some money out.. So this happened all at once

What does the $19670.77 in Box 5 stand for then?? It says Employee Contributions/Designated Roth Contributions or Insurance Premiums..

ebaines · Feb 19, 2009, 12:19 PM

The $19670 is is his after-tax contributions to the IRA. Ths is money he's already paid income tax on, and when he makes a withdrawal the portion attributable to the return of his $19670 in afer-tax contributoins is tax-free. He will owe income tax only on the portion attributable to the growth of the account, or on the return of any pre-tax conributions he may have made.