Distribution From a Qualified Retirement Plan-Exception

Forum|Forum|6 years ago
February 5, 2020
3 replies
25 views

If I am exempted from paying tax on early distribution from a qualified retirement plan. how do I enter that in Turbo Tax?

JulieS

Level 15

On your 1099-R form, the amount that is taxable is listed in box 2. If that amount is wrong, you may need to get your 1099-R form corrected by the company that sent it to you.

The code in box 7, indicates your tax status for this distribution. For an early distribution, you will get 1 or 2. Code 2 means, that a penalty exception applies.

After you enter the 1099-R information in Turbo Tax, you will see a screen telling you that you are paying extra tax on this distribution. After that, they run some of the exceptions to the early withdrawal penalty. Be patient because there are a lot of questions.

Eventually, you will get back to a screen called Your 1099-R entries. Click Continue again and you be asked about all of the remaining exceptions to the penalty.

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nabugmanAuthor

Level 2

Thanks for your reply. Do I need to file the complete tax return, or just the form to amend the return?

KarenM90

Level 11

If your return has already been filed and accepted (or still shows pending) you will need to amend your tax return.

Here is a TurboTax Article on Amending your tax return. If this is necessary you will only change that area of the return that pertains to your 1099R entry: Amending my Tax Return

If you have not filed yet, you can just go back through the screens as outlined in JulieS answer below:

On your 1099-R form, the amount that is taxable is listed in box 2. If that amount is wrong, you may need to get your 1099-R form corrected by the company that sent it to you.

The code in box 7, indicates your tax status for this distribution. For an early distribution, you will get 1 or 2. Code 2 means, that a penalty exception applies.

Eventually, you will get back to a screen called Your 1099-R entries. Click Continue again and you be asked about all of the remaining exceptions to the penalty.

**Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"