1099r opm

[TAX SURGEON]

Is the amount in box 2a taxable when it reads unknown it is a distribution code 4 death benefits


Thanks

J Curley

[taxea]

death benefit is exactly that and not taxable as income

[David1980]

"Unknown" taxable amount on a CSA-1099R is equivalent to "taxable amount not determined" on a regular 1099-R. They're saying they don't know how much is taxable.

Usually survivor benefits are taxable in the same manner and to the same extent the benefits would have been taxable to the retiree had the retiree lived to receive them. Depending on when they retired it's usually calculated using the simplified method worksheet.

[FEDUKE404]

Benefits not taxable? - news to me

death benefit is exactly that and not taxable as income

I have several clients who annually receive a Form 1099-R with "Code 4" shown.

Their benefits are fully taxable. . .

FE

[TXEA]

The taxable amount unknown does not imply in any way that the distribution is not taxable. You will need to determine what the payment represents. Is it a death distribution from an IRA? If so, it is completely taxable unless the deceased had a basis in the IRA on Form 8606.

If it is a 401(k) or pension distribution, then it is most likely 100% taxable.

If it is from a non-qualified annuity, then you will need to determine the basis if for some reason the company does not have the information which is most unlikely.

In essence, you need to find out from what type of account or financial instrument this payment derived.

Just remember taxable amount unknown just means the issuer does not know or does not have the information to determine the taxable amount.

Death benefits, other than life insurance benefits, are still potentially taxable, and insurance companies generally do not report life insurance benefits on Form 1099-R unless the payment stream is annuitized. And, when they do this, they know the taxable amount.

[Burke]

A 1099R from Office of Personnel Mgmt (i.e, Civil Service employees) is taxable. Gross amount is shown on the 1099R. Employee contributions are shown in Box 9b. You have to calculate the taxable amount using the Simplified General Method, which should be in your software. You will need the date the pension began and the deceased taxpayer's age at the time the pension began. Gross amount goes on Line 16, and taxable amount goes on Line 16a. Worksheet will also want to know the amounts already recovered after 1986. When entire amount of employee contributions is recovered, it is fully taxable.