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You are correct. They are required to give you a 1099-R, which must be reported on the tax return, but the transaction will not be taxable. It must be reported. You will know that it is not taxable because box 2a should be a "0" for zero taxable income, and box 7 should have the letter G, which is the code for a rollover. So while you are required to report it, you will not have to pay any tax on it.
You are correct. They are required to give you a 1099-R, which must be reported on the tax return, but the transaction will not be taxable. It must be reported. You will know that it is not taxable because box 2a should be a "0" for zero taxable income, and box 7 should have the letter G, which is the code for a rollover. So while you are required to report it, you will not have to pay any tax on it.
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