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1099-R Distribution Codes

1099-R Distribution Codes

What is a 1099-R?

Form 1099-R reports the total retirement and pension benefits you received during the year.

Refer to box 7 on Form(s) 1099-R for the distribution code(s) that describes the condition under which the retirement or pension benefit was paid.

The list of codes below describes eligibility for a benefits subtraction based on each code. Some exceptions exist. If your distribution code is not included in the list below or if you have questions on eligibility of your benefits, please consult your tax professional.

1099-R Codes

  • Not an eligible distribution for a Michigan retirement and pension subtraction.

  • Not eligible, unless:

    • Part of a series of mainly equal periodic payments made for the life of the employee or the joint lives of the employee and their beneficiary;
    • Early retirement under the terms of the plan.
     

  • Eligible distribution

  • Eligible distribution if paid to surviving spouse only and if the decedent would have also qualified for a normal distribution under Distribution Code 7 at the time of death (see code 7 below).

    Not and eligible distribution if paid:

    • to any other beneficiaries, or
    • as a death benefit payment made by an employer but not made as part of a pension, profit sharing, or retirement plan.
     

  • Not an eligible distribution for a Michigan retirement and pension subtraction.

  • Not an eligible distribution for a Michigan retirement and pension subtraction.

  • Eligible distribution, if

    • it's a normal distribution from a plan,
    • it's a distribution from a traditional IRA,
    • the participant is at least 59½,
    • Roth conversion if the participant is at least age 59½,
    • it's a distribution from a life insurance, annuity, or endowment contract, the person is 65 and part of a series of mainly equal periodic payments made for the life of the employee or the joint lives of the employee and their beneficiary.
    Exception: You may not subtract distributions from a plan that:
    • allows the employee to set the amount of compensation to be deferred
    • does not prescribe the retirement age or years of service
       

  • Not an eligible distribution for a Michigan retirement and pension subtraction.

  • Not an eligible distribution for a Michigan retirement and pension subtraction.