I receive a monthly payment from my former spouse's pension. He is over 60 and retired - I am 48 and not retired. The 1099R I received has "Unknown" as the Taxable amount. I have not withheld any taxes from these payments, although $150 of my monthly disbursement is applied to my survivor benefit. I am not sure how much of the amount is taxable - and/or if I need to pay a penalty.
Then no penalty applies, enter the 1099R as its shown, leave the box that says Unknown empty.
I just realized that, on the side of the form, it says form CSA 1099R - does that make a difference?
be sure you select CSA 1099R, not a regular 1099R or the boxes may not match up.
I did...then it asks me "Tell Us the Taxable Amount Method" - either Simplified or General Rule? Not sure which to do. When I choose Simplified it asks me for the "Plan Cost"and "Tax-Free Amount Previously Recovered" - I assume those are both 0 since I did not contribute to this plan, my ex did? And when I do that, it says the entire amount is taxable and knocks my refund down about $2500.
@dmertz is there an adjustment that needs to be made in this situation or is all of it taxable?
Only if your ex made after-tax payments to the plan would any portion of the distribution be nontaxable. With the pension split under a QDRO, your ex's after-tax basis, if any, generally would be split in proportion to the overall split and your share of that after-tax basis would be your Plan Cost. Since the payer doesn't seem to know if there is any after-tax basis in the plan, you would need to obtain that information from your ex.
Thank you so much for the answer. I guarantee he did not make any after tax payments. Do I pay an early disbursement penalty because I am only 48 and not retired. It looks like TurboTax hits me with about a 25% tax on the money.
Code 7 means that TurboTax will not include on line 59 of Form 1040 any early-distribution penalty for this distribution. However, the entire distribution *is* subject to ordinary income tax.