Very confusing questions regarding a 1099-R pension payout from deceased benefactor who was a public safety officer

[winiarz]

In the 1099-R section, there is a question as to whether or not the money was received from employment as a public safety officer.  The top half of the section alludes to my employment, but the bottom half is the section is generic and refers to this money being received from employment of a public service officer.

While I am not a police officer, my now deceased parent was and this payment to me was from her account to as a beneficiary after her death.

So do I answer "Yes" or "No" when TurboTax asks if the money came from employment as a public service officer?  The way the screen is presented is confusing.

[Critter · Accepted solution]

No, you were not the officer. 

[reginarberg]

The question does not ask if YOU were the PSO. The question asks if the income "came from" employment as a PSO.  That being the case, if you received funds from your deceased parent's employment as a PSO, seems to me the answer would be yes, because that is where the money "came from" as phrased in the question.

[macuser_22]

@reginarberg - A yes only allows a PSO to deduct up to $3,000 to pay the PSO's health insurance if the insurance  was paid by the plan.   If you are not the PSO then you cannot deduct it and the plan should not have paid it anyway after death so the answer is probably immaterial.

<a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/p721.pdf">https://www.irs.gov/pub/irs-pdf/p721.pdf</a>  page 18.
Distributions Used To Pay Insurance Premiums for Public Safety Officers

[Critter]

All the questions are based on the fact you are filing your tax return not your parents ... so any such questions should be taken in the first person ... did YOU have this come from employment you did.

[reginarberg]

While I realize I am not filling out someone else's tax return, the question remains unclear. In Turbo Tax, the question about the retirement income is "did this come from employment as a PSO?" The question is not "did this come from YOUR employment as a PSO?"  I receive the retirement income as a result of my ex-spouses employment as a PSO.  If he were not a PSO, I would not be receiving it. One could argue then that this income DID come from employment as a PSO.  I'm not arguing the right/wrong of the answer. I'm saying that, based on the way the question is phrased, one could argue a 'yes' or 'no' answer. The question should be more specifically phrased.  I note macuser_22 response however, I am unclear as to why he responds with info about health insurance premiums and points to a publication about insurance premiums for PSO's.  I don't believe the info is related to the original question.

[macuser_22]

@reginarberg - Because the answer to the PSO question does not go on a tax return.  It's only propose is to bring up the next TurboTax interview screen.  A "yes" answer will the ask "Did the pension plan administrator Pay for Health Insurance - Did the pension administrator take out money form xxx's pension to pay for health insurance".

Answering no to the PSO question just avoids the health insurance question - that is all the PSO questions does.

If health insurance premiums were not paid by the plan then it makes no difference if the PSO question  is answered yes OR no, the result will be the same but there will be extra questions to answer.

(If by chance health insurance premiums WERE paid by the plan then consult the plan administrator for guidance - plan rules can differ.)

[reginarberg]

Okay, NOW I get it.  I wish that was more clearly explained in the TT program.  So, unless health premiums were paid, your answer doesn't matter.  I answered 'yes' just to see what would happen and, you are correct, additional questions pop up about health premiums.  I went back and changed my  answer to 'no' and it moved on.  Neither answer altered my tax liability as there was no health premiums paid.  Again, I think TT could improve on this section by either explaining how your answer effects your return or by clarifying the question by rephrasing it.  Thank you for the time you spent explaining this. I'm sorry I didn't catch on sooner.

[user75123]

Thank you @macuser_22 and @reginarberg for explaining it in a clear and precise manner! I very much appreciate you both taking the time to go thoroughly through the steps needed to do so. Have a wonderful week! GOD Bless You, Pamela