How do I handle a 2012 1099-R with "R" in box 7?

$365,000 was rolled from a Trad. IRA to a Roth in 2011. It was recharacterized in March of 2012 with additional earnings of $20,000. The 1099-R for 2012 has a R in box 7. My software says to delete it and go back to 2011 and amend that return. When I tried that, entering exactly what was on the form it told me to go back to 2010 etc.

Reply to
KPaw
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Not sure what happened in 2011. So here are two scenarios:

  1. You did not report the conversion on your 2011 return because you recharacterized it before filing your 2011 return in 2012. You would have received a 2011 1099-R with the amount converted and a Code 2 or 7 depending on your age in Box 7 of the 1099-R. You properly reported the gross distribution and the taxable amount was zero. You attached a statement to the return explaining the recharacterization or you forgot to attach the statement.

There is nothing to change in 2011 and there is nothing to report in

2012. If you get a letter from the IRS stating you understated 2011 income because of the conversion, just respond with the explanation and a copy of the 1099-R with the code R.
  1. You did report the conversion using Form 8606 and you paid the taxes on the conversion. You have to amend your 2011 (Form 1040X) return by completing a revised 8606 so it looks like that there was no conversion, leaving the gross IRA distribution as is, changing the taxable IRA distribution to zero, and requesting a refund. The explanation goes on the 1040X. You write the words ?Filed pursuant to section 301.9100-2? at the top of the 1040X. You send the 1040X and the revised 8606 to the IRS.
Reply to
Alan

That's because it thinks you're entering data from a 2011 1099-R, not the 2012 form you're working from. See if there's a place on the input form to clue it in.

If you properly reported the conversion and recharacterization on your original

2011 return there's nothing to amend and no further action is required.

Phil Marti VITA/TCE Volunteer Clarksburg, MD

Reply to
Phil Marti

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