fafsa question 92e parents untaxed portions of IRA distributions

Paying for College
1

I had a rollover of $20,00. The answer to this question is prefilled with “Transferred from the IRS.”
My 1040 shows : line 4a) $20,000, b) zero, 4b) zero. Would you happen to know if the $20,000 is what got “transferred from the IRS”, or is it zero (which is the difference between 4a and 4b) that got “transferred from the IRS”, since it is not visible? I don’t know what figure was pulled from IRS in 92e

Next question on FAFSA is: Did the untaxed portions of IRA distributions and pensions your parents reported for 2018 include rollover(s)? Yes

Then it asks : Enter the rollover amount(s) your parents reported for untaxed portions of IRA distributions reported for 2018 . Should I put $20,000? Because IF 92e it was prefilled with zero from 1040 4b, then the final answer will be NEGATIVE. If it was prefilled with $20,000 from 1040 4a, then it will be zero which is correct.

Please help. I called FAFSA, they had no clue what they were answering.

2

The person who did this rollover should have a record of the amount they rolled over. Check with their records.

When we did rollovers in this family, we knew exactly how much was rolled over.

@BelknapPoint can probably answer your question about what to put…

3

They rolled over $20,000. I just dont know what box the IRS tool pulls from 1040, either 4a, b, or 4b.

4

If it pulls from 4a (20,000)- then I need to subtract 20,000 in the next question to have a result of zero. If it pulls from 4b zero), then I will leave it alone since the result will be$ -20,000

5

The difference between your Form 1040 line 4.a. ($20,000) and line 4.b. ($0) is not $0; it is $20,000.

Yes, if in fact the entire 2018 IRA distribution of $20,000 was a rollover.

6

Why are you referring to 4a, b, and 4b? There are only two Form 1040 lines in play here: 4.a. (total amount of 2018 IRA, pension and annuity distributions) and 4.b. (the taxable amount of what has been reported on line 4.a.).

7

The column all the way on the right from 1040 - line 4b, (not just letter b - taxable amt) shows 0. Line 4a is 20,000. So the reason for my question is when FAFSA asks "Enter the rollover amount(s) your parents reported for untaxed portions of IRA distributions reported for 2018 . Should I put $20,000? Because IF 92e it was prefilled with zero from 1040 - 4b, then the final answer will be NEGATIVE. If it was prefilled with $20,000 from 1040 - 4a, then it will be zero which is correct.

8

The standalone “b” (“b Taxable amount”) refers to the amount that should be entered on line 4b.

If FAFSA question 92.e. was filled using the IRS DRT, the value was probably taken from Form 1040 by subtracting the value on line 4b from the value on line 4a, resulting in the amount of untaxed IRA, pension and annuity distributions in 2018. But I don’t know that for sure, and it really doesn’t matter, as long as you accurately tell the online FAFSA application the 2018 rollover amount. This will exclude the untaxed rollover amount from being reported on FAFSA.

My advice in post #4 above still applies.

9

@Brokee

What he is saying…if the rollover was $20,000…then put that amount in.

I think when you did your subtraction, you did it backwards.

It should be $20,000 minus $0…which would equal $20,000.

You got -$20,000 which would have been $0-$20,000.

Regardless…the amount of the rollover would be $20,000 assuming that was the amount.

10

We know- and have two threads on this now- that you can’t count on the DRT pulling the full rollover detail to the FAFSA.

If the rollover was 20k and all 20k went straight into another qualified investment (that’s what a rollover is,) you have to tell the FAFSA or that field is blank and they will assume the full amount is income when calculating EFC.

So yes, report the 20k as the untaxed rollover amount for Fafsa.
If part was taken in cash, that’s different.

11

OK thank you!!