Drake Users: 1099-R code G (taxable) questions

[John of PA]

I use Drake and as you may know, now that there are 401k conversions at one's place of work from the main 401k bucket to the Roth 401k bucket, there are now 1099-R's with a code G that IS TAXABLE. Not all code G's are tax free anymore. How do you Drake users enter such a 1099-R. As you may know, Drake processes all code G's as non taxable, even if there is an amount in the second box (taxable amount). I have been just entering the 1099 as a code H but their should be a better way. Thanks for any help you can give.

[ATSMAN]

I use Drake and as you may know, now that there are 401k conversions at one's place of work from the main 401k bucket to the Roth 401k bucket, there are now 1099-R's with a code G that IS TAXABLE. Not all code G's are tax free anymore. How do you Drake users enter such a 1099-R. As you may know, Drake processes all code G's as non taxable, even if there is an amount in the second box (taxable amount). I have been just entering the 1099 as a code H but their should be a better way. Thanks for any help you can give.

That is what I do, code H and it works out. Have you called support? Post this on the Drake Forum please.

[John of PA]

There is not an error in the coding. At first I thought the financial institution should be using code H but code H is for rollover to Roth IRA, this is a Roth 401k. I think Drake needs to have a checkbox (like Proseries has) to force a code G 1099-R as taxable. Drake support is not much help unless I do call backs and push harder, which I don't have time to do. The Drake Forum is too hard to get in now that it is on a much more secure server, I frankly don't have time for that nonsense. As you may know, Cyper Criminals are desparately trying to penetrate the tax software vendors websites, which are a gold mine for them; so it is understandable that there are more security hoops to jump through for any function that envolves a tax software vendor. The Tax Book is not a tax prep vendor. Thanks for your posts.

[geekgirldany]

If I put amount in the second box with a code G it is carrying to the 1040 as taxable. I just went in and changed one I am working on to test.

[John of PA]

On my Drake screen, the opposite is true. The amount in the taxable box will not carry to the 1040 when the code is G. Perhaps there are option settings effecting this difference in how your Drake and my Drake is behaving.

[iratax]

On the Drake 1099-R input screen there is a section near the bottom for rollover additional amount. Fill those two in and it works.

[John of PA]

Thank you IRATAX, I'll try it.

[John of PA]

If your talking about the "Rollover Information Section" it still does not work. changing the code to code H is the only way I can make Drake recoginze the Roth conversion 401k as taxable.

[John of PA]

Drake's recommendation (just to pass it on) is to input code G (which is the code on the 1099-R) and then do a screen 3 income override. Thank you for your input.

[JudyL]

Drake's recommendation (just to pass it on) is to input code G (which is the code on the 1099-R) and then do a screen 3 income override. Thank you for your input.

Try using the very bottom right-hand box on the 1099R input screen that says "Portion of 1099R NOT qualifying for state exclusion". When I enter an amount there, it fills in part B of PA Sch W-2S with the proper description and amount and carries it along with any W-2 income to pg 1 of the PA-40 without using any other overrides.

[John of PA]

401k Roth conversion

Update: After talking to several people at Drake, while I prefer to just enter a code H because it's easier, Drake understanabley so does not recommed (it was just one inexperienced person who did) inputing code H when the 1099 code is G. Drake recommends doing a screen 3 override of line 16a and 16b, which the program is designed to make you call tech support to do such an override becasue IRS does not want these amounts overridden. So I apolizied for jumping to a wrong conclusion, Drake is not officially recommending using code H (instead of the G on the 1099R) but reommends calling tech support for a code number to do an override. I agree Drake should just have a check box or something on the 1099 input to make a code G 1099R taxable. (which the other packages have). In reference to the lower corner of the 1099 input screen, my issue is Federal only and is not an issue with PA. Thank you for your posts. Keep in mind this whole issue arose when a few years ago, when people started doing 401k Roth Conversions, the rule that all code G 1099R were non taxable no longer held, there are now TAXALBE code G 1099R's. Many Happy Returns.

[David1980]

which the program is designed to make you call tech support to do such an override becasue IRS does not want these amounts overridden.

I'm always skeptical anytime software providers tell me they are doing something because the IRS wants them to. Sometimes it's true, but often I think it's easy to blame the big evil government.

[TAXNJ]

John of PA....

you deserve a credit off the software for all of your effort and time. Think of exploring a different software product next year!

[John of PA]

Thank you for the post, but actually, overall, I would not trade Drake for anything, I love that package.

[JohnH]

Same here. Nothing in its price range compares to Drake. It is so full of features & benefits that a minor work-around in a rare situation is a small price to pay to get access to its power.