Rollover tax reporting
We recently rolled over a 401 (k) to an IRA for a client. The check was made payable to the Custodian FBO the client. So it was a direct roll over NOT a 60 Day rollover. The 401 (K) Custodian sent a 1099. Does this transaction need to be reported on a tax return? I thought only 60 day roll overs needed to be reported?
Permalink Submitted by Alan Spross on Mon, 2008-03-10 18:20
It has to be reported on line 16 as a rollover, with -0- on 16b and “rollover” entered next to 16b. I assume the 1099R is coded “G” to reflect a direct rollover and there was no withholding taken out. This type of reported rollover does not count at all against the one rollover per 12 month rule from the receiving IRA account because it did not come from an IRA.
The IRA to IRA direct transfers are the ones that do not get reported at all and should not generate a 1099R.