Does the code 3 on 1099-r mean that the distribut. of 5700. would be non taxable to a disabled person ?

[PaulaM · Accepted solution]

No, box 7 code 3 does not mean it is a non taxable distribution.

If you take a retirement distribution because of disability, the distribution is taxed as wages until you reach the minimum retirement age. 

Distributions from an IRA or a pension plan to a taxpayer that has been made due to their Disability is fully taxable to the taxpayer unless the owner had made non-deductible contributions to the IRA or other non-deductible contributions to a pension plan. However, such a distribution is not subject to the 10% early withdrawal penalty, regardless of the age of the taxpayer.

Retirement age is the earliest age you are eligible to receive a pension or annuity from your employer, if you had not been disabled. Most often that is age is 55, but it can vary from one company to another.

[barbaraoc]

Are distributions from an employer funded pension plan, with code 3 in box 7, taxable after retirement age?

[VolvoGirl]

Yes, both before and after retirement age.  It's just before retirement age it gets counted as Wages so you can get EIC credit for it.