1099R Pension

[PFOR]

If I receive monthly pension payments from a qualified retirement plan with 1099-R, what do I select for "What did you do with the money" options?  I did not cash out, I did not roll over or move to another retirement account.  As mentioned, I receive monthly payments and pay both state and federal taxes.  If I chose "cash out" option, it tells me later that I will receive a W2-c, for deferred SS taxes. 

What has changed with 2020 Turbo Tax?  I've received pension payments for several years now and have not had this problem in the past with Turbo tax. 

Thank you.

[SamS1]

Lets start by deleting the 1099R you are working on and start the entry process over,  After you have logged in and are in your return in TurboTax Online:

• Go to Search at the top of the screen.
• Then enter Form 1099-R in the search box. 
• You will see a Jump To function that will take you to the 1099-R input screens. 
• There delete the 1099R in question by clicking on the trash can next to the form
• Then add a new 1099R and manually enter your 1099R.

At the financial services screens, click "Change how I enter my form" then "Type it myself"

Select "I did something else".  If you did not rollover the funds and used it for your monthly expenses, that would be the correct answer.  The cash out option would only be used if you received a lump sum payout for the remainder of your pension payments.  If you are over 70 1/2, at the RMD screens, since its a pension, indicate "I received all my RMD".

The pandemic has affected your taxes in many ways. Including reporting in TurboTax the amount of stimulus money you received. Click Here for more information on how the Pandemic affected your 2020  taxes.

[robtm]

Once you get to the screen where it asks what you did with it, choose 'something else'.  next screen asks if you got regular payments. This defaults to NO. You need to chose YES I got regular payments. This is how I do my pension 1099-r and I get nothing about a W2-c.

[PFOR]

Thanks. We don’t use the online version of turbo tax, so how do we enter the 1099 r manually?

[robtm]

if you're not using the online version then toy must be using the desktop one. click on federal taxes / wages & income. scroll down to Retirement Plans. click on blue button to enter your 1099 data.

[Bsmith1126]

I am having the same issue.  This is the first year entering retirement info.  I have the Deluxe edition and am entering using a disc, not online.  I get two options for what I did with the money 1) roll it into a different account which I did not do, or 2) Do something else.  My "Do something else" option has (cashed it out, etc) after it.  By clicking "something else" my taxes owed jumps almost 10K from where it was before I click that option.  Is this right?  Taxes have already been taken out by the administrator, so why the massive jump?  Am I doing something wrong?  This is really frustrating, because I feel like this is a common issue with retirements.  I don't get why my "Do something else" option is also the cash out option.  Help!  Thanks!

[JulieS]

Yes, the correct answer for you, is, "Did something else with it". 

Many people have complained about the wording of this question, but the purpose of the question is to ask, if you rolled this amount over, or did you keep it outside of a retirement account. 

If the money is rolled over, it is not taxed at all.

If you did anything other than roll it over, it is taxed. That is why your tax due jumped. As long as you enter the taxes withheld in box 4 of your 1099-R, it will be applied to your tax return. 

Even though this answer is lumped with the cashed out option, there is no extra penalty on the money unless you are under age 59-1/2.