Disability income is considered taxable income if the
premiums for the disability insurance were paid by your employer, or if
you paid for the premiums with pre-tax dollars on your paycheck (If you
are not sure, check with your HR department).
- Disability income is non-taxable if you paid the
insurance premiums with after-tax (out of pocket) dollars
- If you and your employer jointly paid the premiums, only the disability amount covered by your employer's
payments are taxable.
To enter your 1099-R in TurboTax:
- Click on Federal > Wages & Income.
- Scroll down to the Retirement Plans and Social Security section and click on the Start/Revisit box next to IRA, 4701(k), Pension Plan Withdrawals (1099-R). [See Screenshot #1, below.]
- If you've already entered one (or more) 1099-Rs, you will see a screen Your1099-R Entries. Click on the link Add Another 1099-R. [Screenshot #2]
- If you haven't already entered a 1099-R, you will see the screen, Your 1099-R. Click Yes and then Continue.
- You can either import your 1099-R or click on the I'll type it in myself box.
- If you select to enter the information yourself, continue through the screens, answering the interview questions.