Distribution Codes
Hi:
I completed a direct inservice 401k to Roth IRA: On my 1099-R box 7, the distribution code is G- direct Rollover. Is this correct? Seems strange to me given this is the same code when I did a nontaxable rollover – 401k to IRA.
I also completed a IRA to Roth IRA: On my 1099-R box 7, the distribution code is 7- Normal distribution. This seems strange to me since it was moved to a Roth IRA account(taxable event) and I did not distribute the money to myself.
Permalink Submitted by Alan - IRA critic on Fri, 2025-03-14 16:46
The 1099R Box 7 codes are correct.
For the 401k to Roth direct rollover, any pre tax amounts would show in Box 2a. But if the rollover was funded from the after tax sub account, only the gains in that sub account would be taxable in Box 2a.
The IRA code 7 denotes a distribution to someone over age 59.5. All Roth conversions are reported as distributions because a conversion is a two part transaction, a distribution plus a rollover to Roth. You must report this on Form 8606, Part II. Part I of Form 8606 also applies if you have basis in your IRA from non deductible contributions, and Part I determines the taxable amount of the conversion.
Permalink Submitted by Pamela Poker-Meichtry on Wed, 2025-03-19 13:43
Can you please answer if distrition code G is correct from aboveII pasted my question from above)?
I completed a direct inservice 401k to Roth IRA: On my 1099-R box 7, the distribution code is G- direct Rollover. Is this correct? Seems strange to me given this is the same code when I did a nontaxable rollover – 401k to IRA.
I did not report on Form 8606 since this was a inservice 401k to Roth IRA and because it came from 401k. How is this reported on my taxes?