It depends. Line 2 refers to the anticipated rate of return on investments related to the pension fund or contract. It is a percentage figure that reflects how much the pension plan is projected to earn over time based on the investments it holds.
This is something that only a plan administrator knows because you are not expected to have this information on your own.
If there are disclosure statements that came with your 1099R, view these to see if this mentioned anywhere in these statements. Sometimes it could be listed as a footnote in the statements. This is critical information that determines your taxable income based on either the three-year rule or general rule.
If you do not have this information, you will select none of the above as you mentioned and the taxable amount that is determined is correct.
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