UHG ERISA SETTLMENT PAYMENT

[wjcarman]

I received a settlement check from the UHG settlement fund for mismanagement of my 401K. I am 81 and long ago rolled over my 401K

I cashed the check..

I received a 1099-R for this distribution

It has a 1 in box 7.  Since it was the result of my 401K, I checked none of the above for your question "Where is your distribution from."

No penalty was applied and form 5329 applies code 99 indicating that it was not subject to to additional taxes.

However, it is treating this as a pension distribution, not a 401K distribution.

Does this matter?

[Vanessa A]

No.  It does not matter.  Both are taxed the same.  In reality, line 4 is for IRA's and line 5 is for pensions and 401ks.  

However, if this is being treated as a pension instead of an 401k Settlement the most likely reason is because of how you answered the questions that followed your 1099-R entries.  If you answered yes to was this a periodic payment or that you received it monthly, it would be treated as a pension.  

To fix this, you can go back through the questions after the 1099-R and double check your answers being sure to say no, you did not receive this monthly or as a periodic payment.