I'm wondering if anyone else is running into the same problem I am. I was medically retired at the end of 2010. This is the first year I am doing my taxes with retirement income. I noticed when I was filing, that block 7 on my 1099-R is a code 7 which means normal distribution as apposed to code 3 which is for disability income. I believe this is due to the error in my 214 when I got out. It said that I voluntarily retired due to length of service. I had it fixed but I don't think DFAS fixed it on their end and it's still not showing as disability retirement. This may not seem like a big deal but as I tweaked with the tax program I found that with a code 7 in there, I'm not eligible for the Earned Income Credit but with a code 3 I am. For me, this is a difference of $8,000! I think I should be eligible for it due to this IRS Publication 596. It says: I'm calling DFAS tomorrow to see if they need to change it but can anyone else tell me what their code is? More info: I'm not eligible for CRSC and I'm not yet getting VA comp.