FICA on Nonqualified Pension

[kcoakley88]

I received a nonqualified pension annuity when I retired.  At that time, FICA was taken on the actuarial present value of all future pension payments, and FICA was not to be taken out of annual pension payments thereafter.  How do I enter this into TT without FICA being taken out?

[CesarJ · Accepted solution]

Since the FICA taxes on your nonqualified pension annuity were already paid on the actuarial present value at retirement, TurboTax does doesn' automatically deduct FICA from pension payments. To enter this correctly:

1. Enter your pension income from Form 1099-R exactly as provided, including the full gross distribution.
2. If TurboTax suggests or shows FICA tax withheld, you can adjust or clear it since your situation is unique.
3. Provide any notes or explanations in the program if prompted for state or federal adjustments.

This approach reports your pension income as taxable but doesn't double-count FICA tax withheld, matching your described payment history.