Is this the actual question? "Basis in retirement plan for annuities and ineligible age/service enter cost recovery basis or enter zero"
Please give us the actual question in TurboTax.
Basis as you may know, is the amount of after-tax contributions that you made to a pension or annuity while working. Once you start receiving amounts from your retirement plan, any after-tax amounts in a yearly distribution are removed from taxable income because you have already paid tax on after-tax dollars.
However, on any qualified plan, the return of basis is spread out over time so that not all the basis is returned in the first year.
So, when asked what the basis is, ask yourself first, "Did I make any after-tax payment to this pension or annuity?" If you didn't, your basis is zero (as it is for many taxpayers).
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