If you are not self employed there should be no self employment tax. If this is reported to you on a Form 1099-MISC, then it should be reported as other income.
If it is reported on a Form 1099R then it should be reported as retirement income without a penalty because you are the beneficiary.
Form 1099-MISC: Report the amount in box 3 (other income)
In TurboTax (online or desktop) follow these steps to reach this result.
- Federal Taxes > Wages & Income > Other Common Income > Income from Form1099-MISC > Update
- Edit > Continue (if all your information is there and the income is in box 3)
- Type Descriptiion, if necessary
- Continue > Check None apply
- No it did not involve work
- Select got it in 2016
- No it didn't involve an intent to earn money
This will place the amount on line 21 as it should. You can review your return by using the steps here.
Form 1099R - Retirement/Death Benefit
While you are signed into your TurboTax (online or desktop) version:
1. Use the Search box in the upper right
2. Search for 1099r
3. Jump to 1099r (image attached)
4. Continue to enter your Form 1099R from the statement