Surrender Cash Value Life Insurance

[sdaudino]

I surrendered a cash value life insurance policy in 2023. I received a 1099-R with box 7 code of 1D. I am confused because I bought the policy with after-tax money, it is not a retirement account. If I enter the code 1 in the first box of turbo tax and D in the second box, it appears I am incurring an additional 10% tax (penalty). That doesn't seem correct. My gut tells me to enter only D in the first box and leave the second box empty. Thank you in advance for your assistance.

[Mike9241]

you are subject to income taxes on the excess of the surrender value in excess of your tax basis. Cashing in before you are 59 1/2 subjects the taxable portion to a 10% penalty

[jglynch]

why would you have code 1d in block seven if you are well over 59 1/2