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1099 R , box 7 code 6

Level 3

New client came in with a 1099R, box 1, 71000; box 5, 5000; and box 7 code 6.

Total distribution box was checked. 

Last year the client received the same 1099R, he put 0 on 1040 as non taxable. I thought 1031 when sold , deferred prior gain would come due as taxable. I am thinking of sending her away. Her preparer was sick.

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1 Comment 1
Level 15

code 6 is 1035 exchange    not 1031 exchange     and should be non taxable