I received a 401K distribution and I received a lot less than what was reported on the 1099-R, is there a penalty fee that should be listed on the 1099?

[macuser_22]

Possibly if not a qualified distribution.  Most 401(k) distribution are taxable income and if tax was withheld, it might not have been enough depending on your margional tax bracket.

What code is in box 7?

[macuser_22 · Accepted solution]

A code 1 indicated that you were under age 59 1/2 so there is an additional 10% early distribution penalty.  If the normal 20% was withheld (in box 4), then half of the withholding will pay the penalty leaving only 10% to pay the tax.   If you are in the 20-30% tax bracket, not nearly enough was withheld to pay the tax so you will owe more.

[fanfare]

you will receive what you receive and the 1099 should reflect that. Subtract any amounts withheld from the gross distribution amount that was removed from your account.