Form 1099-R; Retirement Income & Early Withdrawal Penalty
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Use this page as a guide when entering a Form 1099-R into the program. You will also find a Troubleshooting System Errors and System Limitations, and Information on the Early Distribution Penalty in regards to how to find it and where it can be edited.
Step 1. Once you have entered your Tax Return, look for Forms In Return on the left and scroll down.
Step 2. Click the "Federal" drop-down selection.
Step 3. Click the "Income" drop-down selection.
Step 4. Within the listed "Income" Forms, scroll down and select "Form 1099-R & Exception Page".
Entering Form 1099-R
Step 5. Select "Add New"
Form 1099-R Input Page
You can edit the Payer's Information, Payer's Identification Number, Recipient's Identification Number, or Recipient's Information by clicking the "pencil" icon in the applicable sections.
Enter the information into the corresponding boxes of the Form 1099-R.
*IF you receive the Error shown above, you MUST check-off the IRA/SEP/SIMPLE box next to Box 7 Distribution Code(s)
You will also need to scroll down and select the Type of IRA.
Override for Taxable Amount
When the Taxable Amount Form 1099-R is blank (box 2a). You must “Override Taxable Amount” and enter the taxable amount.
Rollover & Roth Conversions
Rollovers & Roth Conversions
Enter any amount of the distribution rolled-over that does not have code "H" or "G" in box 7.
Rollovers to a Traditional and Roth IRA's are entered into the "Rollover Amount" box.
Enter in this box any rollover amount that was converted to a Roth IRA into the "Roth Conversion Amount" box
"Roth Conversion Amount" will not be shown on Form 1099-R.
Other Details
Disability Pensions Before Retirement Age:
(Employer Paid Disability Income) Check the box to treat the Form 1099-R income as wages when a Distribution is a Disability Pension, Code 2 or Code 3 will be in box 7 of the Form 1099-R. If retirement age set by the employer/payer has not been reached.
Bona Fide Retirement Payment:
Check this box if this payment is considered to be a bona fide retirement payment.
Current Year Taxable Amount for Code P:
Enter the current year taxable amount of the Distribution that has Code "P" in box 7 of the Form 1099-R. Do not use this box if box 7 is code 8 (excess deferrals).
Distributions Treated as Wages
*This is not tax advice. The specific tax information given is limited to the most basic overview. See the IRS.gov website for more information.
Distribution Code 3; Employer Paid Disability Income:
When retirement age has not been reached, disability distributions are treated as earned income, and the taxable amount will be included with wages (form 1040, line 7). Once retirement age is reached, disability distributions are treated as normal distributions, and the taxable amount will be included with pensions (form 1040, line 16b). (Distribution Code 3 retirement age is determined by the taxpayers Employer and can be before or after age 59-1/2)
Distribution Code 8, 8 A, 8 1, 8 2, & 8 4 (Excess Contributions Plus Earnings/ Excess Deferrals)
When box 7 has a code "8" the taxable amount (box 2) is treated as ordinary income, and will be included with wages (form 1040, line 7).
Anytime "code 8" has either an "A", "1", " 2", or "4" next to it, the taxable amount (box 2) the “Double Taxation Rule” is required.
Double Taxation Rule:
This is when the taxable amount (box 2) is included in your ordinary income (form 1040, line 7) and included in your pension income (form 1040, line 16b) in the same year.