I was 41 years old last year. Last year, I asked my financial organization to roll over $8000 in my pre-tax 403(b) to ROTH IRA in the same organization. The organization rolled over $6400 and withheld $1600 for federal tax. Consequently, I received two 1099-R forms. The 1099-R form for the $1600 withheld federal tax has a distribution code "2" for Box 7. My understanding is that the $1600 is subject to the 10% penalty so the distribution code should be "1". I contacted the financial organization and they refused to correct the form. My questions are:
1). Is my understanding that the $1600 tax withheld is subject to the 10% penalty correct?
2). If my understanding is correct and the financial organization refused to correct the 1099-R form, how to correctly file the my tax using the TurboTax? Should I just put distribution code "1" when I put in the information in TurboTax?
