1099R

I have a 1099R disability pension (public safety industrial disability). The base rate is not taxable, but the COLA is taxable. I have reached regular retirement age.
Box 7 is dist code 3 - disability

Here is my problem, employer (govt agency) has box 2b taxable amount not determined, so turbotax wants to tax the entire amount, which is not correct. Employer will not do the 1099 any other way. How do I separate the taxable and non taxable parts of this in turbo tax? Thank you.

208

Expert Alumni

Feb 16, 2021 6:48:06 PM

If it is a pension that you have paid into, then you will have an amount of contribution to the plan that can be recovered using the Simplified method. The simplified method cannot be used until you reach minimum retirement age.

The software has a worksheet in it to compute the tax free portion of return of your contributions.

Each year until the year you reached minimum retirement age, the full amount of disability pension distributed should have been taxable.

You will need to verify the amount of contributions to the plan and they may be reported on your 1099R.

Please refer to the following, if applicable:

How to calculate the simplified method portion of taxfree retirement

Why sign in to the Community?

1099R