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Note. These instructions are for the person completing the Form 1099-R to distribute, and so TaxAct uses these IRS instructions in the program as a guide to handling the amounts reported on forms containing these codes.

According to IRS Instructions for Forms 1099-R and 5498, on page 18:

Q-Qualified distribution from a Roth IRA.

Use code "Q" for a distribution from a Roth IRA if you know that the participant meets the 5-year holding period and:

  • The participant has reached age 59 1/2,
  • The participant died, or
  • The participant is disabled.

Note. If any other code, such as "8" or "P," applies, use code "J."

T-Roth IRA distribution, exception applies.

Use code "T" for a distribution from a Roth IRA if you do not know if the 5-year holding period has been met but:

  • The participant has reached age 59 1/2,
  • The participant died, or
  • The participant is disabled.

Note. If any other code, such as "8" or "P," applies, use code "J."

In the TaxAct program, if code "J" or "T" is used, the checkbox is marked to indicate that the 5-Year Holding Period has NOT been met, and entries have been made for the conversion to a Roth IRA, then Form 5329 will compute the additional tax on the distribution.

To indicate the 5-year holding period has not been met:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
  2. Click Retirement Plan Income in the Federal Quick Q&A Topics menu to expand, then click IRA, 401(k), and pension plan distributions (Form 1099-R).
  3. Click + Add Form 1099-R to create a new copy of the form or click Edit to review a form already created.
  4. Click Quick Entry to scroll down to answer all applicable questions in a new window.
  5. Enter all the applicable fields, including under the "Additional information not reported on Form 1099-R" heading, then click Save & Close.

To enter the information about the Roth conversion:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
  2. Click Retirement Plan Income in the Federal Quick Q&A Topics menu to expand, then click Taxpayer/Spouse Additional taxes on qualified plans (Form 5329).
  3. Click Review on the "Early distributions from a retirement plan" row, then continue with the interview process to enter all of the appropriate information.
  4. Click Retirement Plan Income in the Federal Quick Q&A Topics menu to expand, then click Taxpayer/Spouse Nondeductible IRAs (Form 8606).
  5. Continue with the interview process to enter all of the appropriate information, including when you reach the screen with fields for the year in which you converted to a Roth IRA, then enter amounts from Form 8606 for the applicable year.

Note that any link in the information above is updated each year automatically and will take you to the most recent version of the document at the time it is accessed.


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