Fallen Hero Survivor Benefits and how to exclude from gross income.

[mkoehler]

Hello,

My late husband was a firefighter who had died in the line of duty. Under the Fallen Hero Survivor Benefits Act of 2001, I am allow to exclude the death benefits that I receive from the state retirement service from my gross income. I am unsure how to go about doing this. I have the1099-R and I had found this but unsure if this is the correct way to go about doing it. 

https://ttlc.intuit.com/community/retirement/discussion/how-do-i-claim-the-federal-survivor-benefit-... 

[AnnetteB6]

To clarify your situation a bit further, please share which boxes on your Form 1099-R show amounts reported and also provide the distribution code shown on your form.

[mkoehler]

The only boxes that show amounts is box 1 and box 5, which are the same amount. The distribution code is 4. 

[ThomasM125]

If you are sure the benefits are not taxable, per the information you cited in your original post, then you would enter the form 1099-R as you normally would in the Retirement Plans and Social Security section of TurboTax. Then, you would enter the taxable amount as a negative adjustment to your income as follows:

 Go to the Wages and Income section of TurboTax

 - Choose  Less Common Income

 - Choose Miscellaneous Income, 1099-A, 1099-C

 - Choose Other reportable Income

 - Enter a description for the adjustment and the amount as a negative number

You can look on your form 1040, line 5(b) to determine what amount is being shown as taxable, which is the amount you enter as a negative adjustment. There may be other pension distributions entered there, so make sure you factor that in.

You can view your form 1040 while working in the online version of TurboTax by following these steps:

While working on your return in the Federal section of TurboTax:

   1.  Choose the Tax Tools icon on your left menu bar

   2.  Tools

   3.  View Tax Summary

   4.  Choose the Preview my 1040 on your left menu bar

[mkoehler]

What is the situation if the taxable amount is $0?

[JulieS]

If box 2a on Form 1099-R is $0 (not blank, but $0), all you have to do is to enter the 1099-R as is. 

Your tax return will show the gross amount received and the taxable amount as $0.