DianeW777
Expert Alumni

Retirement tax questions

This indicates only that the company does not know the taxable amount of your annuity.  

 

If Box 2a is blank (empty) on your 1099-R form, the taxable portion of your distribution needs to be calculated:

  • If the distribution is from a Traditional IRA, we'll ask you some questions regarding your non-deductible contributions and then calculate the taxable amount based on your information.
  • If the distribution is from a pension, we’ll consider the entire distribution taxable unless you can calculate the taxable amount and enter it in Box 2a. Don't enter an amount unless you know the taxable portion of your distribution.

Box 5 is not necessarily a direct subtraction from the annuity received in Box 1.  The payer should know if you used after-tax money to pay for this plan.  If you never paid into the annuity then it is fully taxable. If you did pay into the annuity with pre-tax dollars all of it is taxable.

 

If you begin receiving payments from a qualified annuity you can use the Simplified Method to determine the tax free portion of your annuity. For more information you can use the link below.

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