1099-R and PA State Taxes

[CPOSharky]

My Mother has a 1099-R for 2020 and the distribution code is 7D which is normal distribution/annuity payments from non qualified annuities that may be subject to tax under section 1411.  The state tax section is asking to  choose the description or type of retirement distribution that best matches your PA retirement from the list.  The distribution was from a fixed annuity she had with Delaware Life Insurance Co.  Does she want to select from the State type code drop down list: Annuity/or Non Civil Srv disability? 

Thank  you

[ThomasM125]

You would select the Annuity/or Non Civil Srv Disability option, since the distribution is from an annuity.

[CPOSharky]

Thank you!  Now it's asking for Basis of retirement income.  Is this the gross distribution amount (box 1 from 1099-R?

[BillM223]

No. 

"Basis" is the amount of after-tax dollars contributed to the plan while the taxpayer was still working. Since the basis is after-tax dollars, when they are returned to you, they are not taxed again, so TurboTax wants to know.

Note that many (most?) taxpayers don't make after-tax contributions to their pensions/annuities, so if you don't know of any such thing, you can enter zero, which will make your entire distribution taxable.