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How should Turbo Tax handle 1099R has code of 1 when it should be 2. Turbo Tax says it will fill out 5329 form automatically however I am still being 10% taxed. Why?
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June 1, 2019
6:16 AM
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Retirement tax questions
If there is an applicable exception to the early withdrawal penalty, you can claim the exception (an eliminate the penalty) by doing the following:
- Click on the Federal category on the left hand navigation bar.
- Click on the Wages and Income tab at the top of the screen.
- Find the section labeled "Retirement Plans and Social Security" and click show more.
- Click revisit on the line labeled "IRA, 401(k), Pension Plan Withdrawals (1099-R)"
- On the screen labeled "Your 1099-R Entries" click continue.
- Continue to the screen labeled "Identify the Plan" and choose the appropriate option (most likely qualified plan) and hit continue.
- This should bring up a screen labeled "These Situations May Lower Your Tax Bill" enter the applicable amount to be excepted from the 10% penalty in the appropriate field. This will remove (or reduce) the penalty.
June 1, 2019
6:16 AM