1099 R distribution code 2 or 7

Forum|Forum|6 years ago
December 17, 2019
3 replies
12 views

Retired after age 55 receive pension

Distribution code has been a 2.

Will the code change to 7 after age 59 1/2.

I know the code doesn’t make a difference for federal taxes. However it does for my state and local taxes.

What constitutes “normal distribution” code 7? After age 59 1/2 or after I reach normal distribution for the company’s pension plan?

Pension Plan

macuser_22

Alumni - Champ

The payer must know that the account owner has reached the age of 59 1/2 before a code 7 can be used.

https://www.irs.gov/instructions/i1099r#idm140345395727808

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**

SteamTrain

Level 15

In the year I turned 59.5, my pension issued two 1099-R forms.

One detailing just the before 59.5 $$ and a code 2....and a second one with just the after 59.5 $$ and a code 7. I would hope your pension does similar to make it perfectly clear. I suspect that they are required to do it that way.

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*

martwm6489

Level 2

the code is 7. the plan is a 403b. Mi public school employees retirement system and it is qualified. Turbo tax wants an answer about required minimum distribution and then it wants to know how much of the gross distribution was RMD

SteamTrain

Level 15

@martwm6489

IF you were age 70.5 or older in 2019, and the distribution was just from the normal monthly annuitized payments they make (you didn't take anything extra out of the account) then all of it is an RMD.

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*