How to Report an IRA Rollover on a Tax Return

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An Individual Retirement Account (IRA) is a retirement account that receives special tax treatment by the Internal Revenue Service (IRS). An IRA rollover refers to when you take money out of one IRA and transfer it into another IRA. When you perform a rollover, you must report it on your income tax return, even if you do not owe any taxes on the rollover. People may roll over money to consolidate their retirement accounts, seek higher returns or convert money from a tax-deferred IRA to a Roth IRA.

Step 1

Determine the amount of money that you took out of your by consulting the 1099-R form that you should receive at the beginning of the next year from your financial institution that you took the money out of. For rollovers made during the 2009 tax year, you should receive your 1099-R by early February.

Step 2

Report this amount as an IRA distribution on Line 15a of your Form 1040 tax return or Line 11a of your form 1040A tax return.

Step 3

Determine how much of your rollover is taxable. If you rolled money from a tax-deferred IRA, including traditional IRAs, SEP IRAs and SIMPLE IRAs, to another tax-deferred IRA, or if you rolled money from a Roth IRA to another Roth IRA, you owe no tax. If you moved money from a tax-deferred IRA to a Roth IRA, you must pay income taxes on the amount converted.

Step 4

Report the amount of the rollover that is taxable on Line 15b of Form 1040 or Line 11b of Form 1040A and write "Rollover" next to the line.

Step 5

Report any federal income tax withheld from your rollover as taxes withheld to apply that amount to your tax bill. The amount withheld can be found in Box 4 of your 1099-R form.

Warning

If you roll over money from a tax-deferred IRA to a traditional IRA, make sure that you have money set aside to pay for the extra tax bill at the end of the year.

Things You'll Need

  • Form 1099-R

  • Form 1040 or 1040A

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