1099-R Distribution Code is 1B For Non-Vested Employer Contribution

[User1001]

I had employer contributions that were not vested when I left a recent job. On the 1099-R the Distribution Code in box 7 is 1B. The gross distribution in box 1 is $0.00. Box 5 is the only box that has an amount.  After filling in the information in TurboTax, the next screen says 'About the Money You Took Out of This Account' and says 'Based on the code you entered in box 7 of this 1099-R, you're paying extra tax on this money.'  Since I wasn't vested the company took this money back and I didn't get any of it.  Since box 7 on my 1099-R says 1B, I selected 1 in the first dropdown in TurboTax and B in the second dropdown. Am I doing something incorrectly to get this message from TurboTax?

[DanaB27 · Accepted solution]

No, you didn't do anything wrong. The "How your taxes are looking so far" screen is just a general information screen that comes up when you enter your Form-1099-R and the code in box 7 indicates an early distribution.

Based on the information you gave me you shouldn't pay extra tax money on this because of what is entered in the other boxes of your Form 1099-R.

[User1001]

Thanks a lot for the help @DanaB27.