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If you used TurboTax previously without a penalty on your 401K distribution, you may have answered a question differently when entering your 1099-R this year. There has not been a change to early retirement penalty exceptions. Separation from service if age requirements are met is one of them.
If you imported your 1099-R, go back and delete it and then enter it manually.
Thanks you.
The age requirement for that company was age 50, but I was not a public safety officer. So, assumed that did not pertain to me.
TurboTax has no way of knowing if a distribution is "early" for your pension (your plan sets the age of normal retirement), so TurboTax has to depend on the codes in box 7 on the 1099-R reporting the plan distribution.
I am guessing that the code in box 7 on your 1099-R is different this year than from previous years.
What is the box 7 code this year, and what was the box 7 code on your 1099-R in previous years?
What do you mean by "pension"? Exactly what kind of plan is it?
Is it a defined benefits plan (you get a guaranteed benefit based on age and service time) or is it a defined contribution plan (you and the employer contribute money to a retirement fund and you and withdraw whatever you want based on how your investments perform). Do you know if it is specifically a 401k, 403b, 457a, 401a, or some other number?
What codes are in box 7 of your 1099-R? What codes were present in your 2021 1099-R?
All this is important because "early" has different meanings and different consequences for different kinds of plans. The other expert answer seems to assume this is a 401(k) plan, but I think that would be unusual for a county government employee.
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