1099-R

[Peggymom]

I received my 1099-R - I am a retired police officer.  I started getting early S/S and was told that  I could make $17,???.00 before I would have to pay tax on any wages I received.  I did work part time and did make almost $5,000.00.  I received $20,???.00 from S/S but when I fill out all the info for my return, it is showing that $17,???. is taxable and the remainder is non taxable.  This is not suppose to be since my 1099-R is not considered income (according to S/S office) it is only for IRS taxes.  Have I missed a place in my filling out my return?

[SteamTrain]

You have a slight mis-conception about what is involved there.

1)  If you start collecting SS early, before the full-retirement age for SS, then SS will reduce the next year's actual monthly payout of SS benefits, if your work salary (or self-employment profit)  exceeds ~$18.2k for 2020.  So, after you file your 2020 taxes, SS will see that you "earned" ~$5k from part-timework, and they won't change next year's monthly benefits ... because it was only 5k.    Your 1099-R doesn't affect that.

________________________________________

2)  How much of your yearly SS income is "taxable" is an entirely different situation. 

 IF you only had SS during the year, and no work income, no 1099-R, no investment income...then none of the SS is taxed......but as you get more income of any other kind during the year, then some of the SS can become taxable....up  to 85% of it.   So yes, the 1099-R income does affect that.  Apparently you've received enough other income such that your SS is getting taxed.

https://ttlc.intuit.com/community/retirement/help/why-did-the-taxable-amount-of-my-social-security-b...

[Peggymom]

I was told by SS when I signed up that since my 1099-r was from a public service (police officer) that there would be no IRS tax on my SS, but only a change in my SS payment if I made to much money ie w2. So why is there a special question (yes or no) in turbo tax whether your 2099-r is for a public servant ie police officer. 

[SteamTrain]

The software asks that question, because it doesn't know if the 1099-R is for a Police officer...  BUT, IF there are $$ in box 5 that went to health insurance, then up to $3000 of the distribution will not show up as being taxable income on the Federal 1040.

____________________________

BUT the statement :

---

@Peggymom wrote:

I was told by SS when I signed up that since my 1099-r was from a public service (police officer) that there would be no IRS tax on my SS, but only a change in my SS payment if I made to much money ie w2. .....

---

...you may have misheard...or the person you talked to at SS fumbled things in that part I underlined.   

There is no such exemption in a Federal tax return for not including that 1099-R distribution as income for determining IF some of your SS is going to get Federally income-taxed (But I haven't thought about if it is a Disability pension...that might be different...box 7 would contain a code 3) .    Some state tax returns will exempt it from the state income tax, but not the Feds.