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Returning Member
posted Apr 19, 2020 10:27:26 AM

form 1099-R penalties

I was a Reservist for the last 28 years. I was on and off Active duty for numerous deployments. My pension was incorrectly managed by my employer. I subsequently received a payment for their errors in 2019. The Form 1099-r reflects that I paid federal and state taxes.  

Turbo Tax references 180 days of Active duty being performed waives the penalties for an early withdraw?

Does that 180 days need to be consecutive or can it be a group of days that add up or exceed the 180 days?

Thank you

Tim

0 3 662
3 Replies
Level 15
Apr 19, 2020 10:43:26 AM

The total number of days during the tax year spent as a reservist called to active duty.

 

After reading the actual law, it appear that the days must be a "period" of 179 days or more called to active duty.

 

 

https://www.law.cornell.edu/uscode/text/26/72

 

26 USC §72 (t)(1)(G)(iii)

 

(iii) Qualified reservist distributionFor purposes of this subparagraph, the term “qualified reservist distribution” means any distribution to an individual if—

(I)
such distribution is from an individual retirement plan, or from amounts attributable to employer contributions made pursuant to elective deferrals described in subparagraph (A) or (C) of section 402(g)(3) or section 501(c)(18)(D)(iii),
(II)
such individual was (by reason of being a member of a reserve component (as defined in section 101 of title 37, United States Code)) ordered or called to active duty for a period in excess of 179 days or for an indefinite period, and
(III)
such distribution is made during the period beginning on the date of such order or call and ending at the close of the active duty period.
 
Answer edited

Level 15
Apr 19, 2020 11:02:51 AM

@bodena If you received an email I revised and edited my answer after further research.

Returning Member
Apr 19, 2020 1:25:25 PM

Thank you for your answer