I receive a Federal annuity from the Office of Personnel Management (OPM). Turbo Tax asks for the codes in Blocks 7a and 7b and won't let me continue without entering them. My 1099-R from OPM doesn't have these blocks. It has Block 7 which shows "7 - NONDISABILITY." The Turbo Tax drop down has a code 7, but it is not described as "NONDISABILITY." When I select "7" from the drop down, it asks questions that make it sound like this is money distributed from an IRA, 401(k). I am confused. Please help. Thank you.
OPM does that. They throw in a word that is supposed to be helpful but confuses people when filing their tax return. There is no such code 7 - NonDisability.
The Code of 7 in Box 7 mean a Normal Distribution, so you select the code of 7 in box 7.
If you are under the age of 70 1/2 where asked What you did with the money? select Did something else with it. Assuming you did NOT move the money to another retirement account.
If you are age 70 1/2 or older then where asked Was this withdrawal an RMD? select Yes and then All was an RMD. When you are age 70 1/2 or older All of your pension income is an RMD.
The code on your Form 1099-R that shows as 7 - NONDISABILITY is the equivalent code 7 for normal distribution that most Form 1099-R use. You will only need to enter it in the first dropdown area for box 7.
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