Retirement tax questions

A code 7 in box 7 means no penalty and qualify for the NY exemption. You have code 1. Which means the 5329 on the federal and if any of the exceptions can be met, you can claim it. Super high medical bills for instance can be used even if that wasn't the original purpose.

As for NY, we don't know your age. The code 1 tells me you should be under 59 1/2 and not qualify. If you are over 59 1/2, you qualify. 

Reference: New York Pension Exclusion.

If you have already filed your tax returns, wait until they are accepted and the dust settles, then you can amend.

Follow these steps:

First - Save a copy of your original file by downloading or printing a copy for your records.

Second - You will need to file an amended return with federal and  amend your state as well. See How do I amend my federal tax return for this year? and I need to amend my state return.

Third - Correct the income.

Fourth - Be sure to enter the amount of refund already received as you go through the program. See it on line 18 of the 1040x.

Fifth - E-file federal and state, if possible. See Can I e-file my amended state return?

If you must mail your state, be sure to sign and date. Mail with tracking and no signature required.

Sixth - make any payments due online. For the federal, Payments for your state check here.