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New Member
posted Jan 27, 2023 3:07:06 PM

Why am I being taxed on 1099-R when the distribution code is 3

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1 Best answer
Expert Alumni
Jan 27, 2023 3:44:44 PM

Code 3 for Retirement distribution on Form 1099-R does not mean it is non-taxable. Distributions taken for disability are taxed as wages until you reach the minimum retirement age.

 

However, such a distribution is not subject to the 10% early withdrawal penalty, regardless of the age of the taxpayer.
 

 

1 Replies
Expert Alumni
Jan 27, 2023 3:44:44 PM

Code 3 for Retirement distribution on Form 1099-R does not mean it is non-taxable. Distributions taken for disability are taxed as wages until you reach the minimum retirement age.

 

However, such a distribution is not subject to the 10% early withdrawal penalty, regardless of the age of the taxpayer.