mrichman333 Posted March 31, 2016 Report Share Posted March 31, 2016 OK, please correct me if I am wrong. A T/P has a 1099-R with code 2 in box 7. she is under 59 1/2. My understanding is code 2 exempts her from the early penalty but not the tax. Box 2 is blank and Taxable amount not determined is checked. Quote Link to comment Share on other sites More sharing options...
Jack from Ohio Posted March 31, 2016 Report Share Posted March 31, 2016 Box 2 is empty and "Taxable Amount Not Determined" is marked because the company handling the money has no clue if there is non-deductible basis in the account. To accurately determine Box 2 amount, you must find out if and how much non-deductible basis she has in the retirement account, and pro-rate accordingly. Code 2 DOES exempt her from penalty. 3 Quote Link to comment Share on other sites More sharing options...
mrichman333 Posted March 31, 2016 Author Report Share Posted March 31, 2016 I believe it's a pension that she did not contribute to. Last year her 90 year old father did her return and he showed it as not taxable at all, but he also showed $11,000 in medical expenses that they did not have. 1 Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.