Periodic Payments (1099-R Problem)

[mwandaw]

My wife started receiving monthly pension payments late in 2020. She also received them monthly throughout 2021. Her payments are from an pension benefit program, not from an IRA, 401k, etc. She did not contribute to this pension.

I entered the information from her 1099-R. Then TurboTax asked if she received periodic payments. I clicked on yes, because she gets a payment every month.

Next TurboTax asked if 2021 was the first year she received payments. I clicked on no, because she received some payments in 2020.

I was then asked the taxable amount from the 1099-R was the same in previous years. I answered no, because she just received a few monthly payments in 2020, but 12 monthly payments in 2021.

At that point TurboTax asked about Simplified/General tax calculations, annuity start dates, plan costs and much more. First, this isn't an annuity, and second I have no idea.

I'd appreciate some help!

[dmertz]

"I was then asked the taxable amount from the 1099-R was the same in previous years."

I don't think that that is what TurboTax asks.  I believe that TurboTax asks if the box 2a amount represented the correct taxable amount in previous years.  Answer that the previous Form(s) 1099-R did show the correct taxable amount so that TurboTax will not send you inappropriately into the Simplified Method or General Rule questions.

Many people get confused by this line of questions in TurboTax and then end up with a letter from the IRS indicating that they underreported income when they inappropriately used the Simplified Method to incorrectly determine that less than the full amount was taxable.

[mwandaw]

Thank you very much for your reply!

Here's a screen shot. I think the wording is easy to misunderstand.

[Azhriaz]

Thank you so much for the answer.  I was in the same boat as the OP.  Turbotax definitely needs to reword that question.  Thanks again.