CSA 1099-R Block 2a

[bobqsup]

OPM lists a taxable amount on box 2a.  OPM calculated this amount based on the original annuity using the Simplified Method.  Under this method a fixed amount of each monthly payment is tax free until you recover your contributions.  However, turbo tax will calculate the amount using the Simplified Method Smart Worksheet. OPM will result in an age factor of about 310 payment months (~ 27 years) to recover the contributions.  Turbo tax uses an age factor that results in 210 payments (~17 years) for recovery  So, which calculation do /can you use?

[ColeenD3 · Accepted solution]

Be sure to pick the correct 1099-R type:  Standard 1099-R, CSA-1099-R, CSF-1099-R, RRB-1099-R.

Please see the multiple posts discussing this situation in this LINK.

[dmertz]

You use which ever one is correct, which is likely to be the OPM calculation (which is also the one that the IRS will assume is correct without any evidence to support a different amount being taxable).  See How to use the Simplified Method in IRS Pub 575.  The difference in the number of expected monthly payments is apparently due to differences regarding the ages of those covered by the annuity (Table 1 for a single-life annuity, Table 2 for a multiple-life annuity).  A factor of 310 would apply if it's a single-life annuity and the individual is age 56 to 60 or it's a multiple-life annuity with ages totaling 121 to 130 years.  A factor of 210 would apply if it's a single-life annuity and the individual is age 66 to 70 or it's a multiple-life annuity with ages totaling 141 years or more.

https://www.irs.gov/pub/irs-pdf/p575.pdf

Since both you an the OPM probably know the ages, the difference is likely that you are calculating based on it being a single-life annuity while the OPM is calculating based on it being a multiple-life annuity.