@Opus 17
Thank you very much for the input.
I have no problem paying the $160 penalty and I am willing to pay the $160 when I file the return so it is done correctly. The issue is that the 1099-R uses "Code 2" to indicate the $1600 is exempt from the penalty so how to include the $160 penalty when I file the return? If I manually choose "Code 1" when I put the 1099-R information in TurboTax, I will be able to pay the $160 penalty but the code will not match what IRS's copy of the 1099-R has.
Should I choose "I need to prepare a substitute 1099-R" at TurboTax to file a "4852" and explain it?
