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Retirement tax questions
"I am getting a screen that states you dont owe taxes on this money"
It's saying that you don't own additional taxes. Code 2 in box 7 of the Form 1099-R means that the distribution is not subject to an early-distribution penalty (an additional tax).
It's entirely possible that you are not having sufficient taxes withheld from your pension payments to cover the additional tax liability resulting from this income.
‎April 14, 2025
5:38 PM