Unless you put it into another 401K or IRA within 60 days you just pick you did something else with it like cashed it out.
To put what? Are you entering the 1099R? I don't understand what problem you have. It be all be taxable.
Enter a 1099R under
Federal Taxes on left
Wages & Income
Then scroll way down to Retirement Plans and Social Security
Then IRA, 401(k), Pension Plan Withdrawals (1099-R) – Click Start
I get that part. It's asking me how did I use the money? I am asking, what box do I choose if the money was sent to me because the account was closed out? You said to "pick you did something else with it like cashed it out." This is where I got lost.
What are the choices? Should be 2....moved it to another retirement account OR did something else with it. Pick the second one. They sent you the cash. Or are you at the end and it wants to know if you have an exception to the 10% Early Withdrawal Penalty. What code is in box 7?
Enter the 1099-R exactly as you see on the form. Whichever boxes are completed on the form, will be the same entries in TurboTax. Box 7 should have the distribution code (s).
If that does not answer your question, please clarify. I screenshot of what you are seeing in the program might help as well.
Q. It's asking me how did I use the money? I am asking, what box do I choose if the money was sent to me because the account was closed out? You said to "pick you did something else with it like cashed it out." This is where I got lost.
A. You seem to be hoping that "the account was closed out" qualifies as a reason the distribution will not be taxable or, at least, not subject to the 10% early withdrawal (under age 59.5) penalty. It isn't.
You had 60 days to roll that money over to another qualified account (usually an IRA). If you didn't, TurboTax (TT) will treat it as taxable distribution and prepare form 5329 to calculate the penalty.
There are only two choices on the what did you do with the money question. You rolled it over or you didn't.