Hazardous Duty Pension

Forum|Forum|4 years ago
January 24, 2022
1 reply
8 views

I am receiving a Hazardous Duty pension, and have both state and federal taxes being taken out. When I inputted my retirement pension, collected thus far, via monthly checks, it shows as a with drawl and I am being severely penalized ($6,000+) on my tax return. Is this correct?

DoninGA

Level 15

On the Form 1099-R you received for the pension what is the code entered in box 7?

DoninGA

Level 15

1—Early distribution, no known exception (in most cases, under age 59½)

Then you are being assessed a 10% early distribution penalty on the amount in box 1 of the Form 1099-R. The penalty is entered on your federal tax return as a tax liability on Schedule 2 Line 8. This amount flows to your federal tax return, Form 1040 Line 23.

BryanVigerAuthor

Level 2

Thank you. I am under the age you mentioned; however, this is a hazardous duty pension ("20 years of service and retire with full pension"). Not sure why it is being categorized as a withdrawal, thus me being penalized, when it is beyond my fault, that I retired prior to 59 1/2. Make sense?