CSX optout

[oceanlovin'ea]

Client is retired from railroad. He received a check for several hundred dollars from CSX and the explanation is 2010optout - 3101.

He says it has something to do with insurance.

I don't think it is taxable. He received nothing from them in the form of a 1099.

Anyone know anything about this?

Linda, EA

[jimmcg]

Client is retired from railroad. He received a check for several hundred dollars from CSX and the explanation is 2010optout - 3101.

He says it has something to do with insurance.

I don't think it is taxable. He received nothing from them in the form of a 1099.

Anyone know anything about this?

Linda, EA

Some early retirement plans have employee options to "opt out" of certain rights that they are entitled to in reurn for them receiving certain consideration. Find out what right he opted out of and you will find out the taxable status of the "opt out"amount. Bottom line, contact CSX human resources or legal dept.

[oceanlovin'ea]

sent email

I actually did go on CSX's website last night and sent them an email. There was a code after the words, optout.

Hopefully they will answer in a day or so.

Linda, EA

[oceanlovin'ea]

got answer

I got an email back from CSX today and this is what they said,

"CSX retirees that were Medicare eligible had an option to enroll in a CSX sponsored medical plan or opt out to receive a $500 credit. The credit has to be reported as earnings."

so it is a taxable event.

Linda, EA