1099-R Code B: Designated Roth Account Distribution

Money out of a workplace Roth account rather than a Roth IRA; pairs with a number showing your status.

What the IRS instructions say

Official meaning, from the Instructions for Forms 1099-R and 5498 A distribution from a designated Roth account (Roth 401(k), 403(b), or 457(b)), unless codes E or H apply.

Is it taxable, and does the 10 percent penalty apply?

Depends on whether the distribution is qualified. A designated Roth payout is tax free only if you are 59 and a half (or disabled, or it is paid after death) AND the account has satisfied its 5 tax year clock. Otherwise the earnings portion shown in Box 2a is taxable, and the 10 percent additional tax can apply to it if you are under 59 and a half with no exception.

Worth knowing: Workplace Roth (this code) and Roth IRA (codes J, Q, T) run on separate 5 year clocks. A direct rollover from a designated Roth account to a Roth IRA is code H, not B.

Combinations you might see

Box 7 can carry two codes. With code B, the pairings mean:

1B / 2B / 4B / 7B: paired with your status, early with no known exception, early with an exception, death, or normal
B8 / BP: an excess contribution returned from the Roth account, taxable in the form year (8) or the prior year (P)
BG: a direct rollover from one designated Roth account to another
BL / BM: a loan from the Roth side treated as a deemed distribution or a qualified plan loan offset
BU: ESOP dividends paid through the designated Roth account

If this code looks wrong

The IRS matches Box 7 against your return, so start with the payer: request a corrected 1099-R, which is the IRS's standing instruction for incorrect forms. No corrected copy by the end of February? The IRS can contact the payer for you, and Form 4852 substitutes as a last resort. Remember that an indirect 60-day rollover is correctly coded 1 or 7, because the payer cannot see the redeposit; direct rollovers should show G or H, as our rollover guide explains before the paperwork ever gets cut.

← All 1099-R Box 7 codes

Sources: IRS Instructions for Forms 1099-R and 5498; IRS Tax Topics 558 (early distributions), 413 (rollovers), and 154 (incorrect forms). Verified July 2026.

General educational information, not tax advice. Your distribution's taxation depends on your facts; consult a qualified tax professional. ClearChoiceRadar is not affiliated with the IRS or any government agency.