dmertz
Level 15

Retirement tax questions

Since your distribution is a a nonqualified distribution, as NCperson said, Form 8606 Part III is required to calculate the taxable portion, which will be zero if line 22 is greater than line 19.  Being nontaxable, this portion will also not be subject to penalty.  Without this form being provided to the IRS by you, code J indicates that your entire distribution is subject to tax and early-distribution penalty.

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