I’m not sure why I received Form 1099-R this year in February containing code “G“ in box 7 from my former employer 401k provider, especially since I transferred my former employer 401k to my self-employed business Solo 401k, which I have invested in real-estate rental properties and precious metals, investments that my former employer’s 401k did not permit.
After you open Solo 401k and transfer your former employer 401k plan to it, the movement of the funds is reportable but not taxable when code “G” is populated in box 7 of Form 1099-R. Therefore, the transfer of your former employer 401k to Solo 401k is not considered taxable but, instead, only reportable to the IRS. The former employer 401k transfer is also reportable on your personal tax return (Form 1040) in line 16a by entering 0 and entering “transfer” in box 16b. You will need to file Form 1099-R with your personal tax return (Form 1040).
Lastly, if you received copy of Form 1099-R from your former employer 401k provider that contains code 1 or 7 in box 7 instead of code G, you should contact your current Solo 401k provider so they can assist you in clarifying the matter with your former employer 401k provider.