Hello... I have the same issue except no federal taxes were taken out. I received a small one-time lump sum death benefit from my brother's estate. It was for the three weeks of his last months annuity before he passed (he was retired USPS worker also). I entered the 1099-R_LS with Distribution Code 7 (Death Benefit) from the Office of Personnel Management - yet Turbo Tax thinks that I retired and is asking me about my "retirement plan" and "annuity start date, plan cost, etc.".
