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lbmmm
New Member

There is no Simplified Method Line 3 on our 1099-Rs. What am I to do?

 
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Coleen3
Intuit Alumni

There is no Simplified Method Line 3 on our 1099-Rs. What am I to do?

If you made any after-tax contributions to your pension/annuity plan, you can exclude part of your pension/annuity from taxable income.  Generally, you must figure the tax-free part when the first payments begin. 

To determine how much of your pension is taxable and how much is tax free, you must use:

a.      Simplified Method

*you must use it if your annuity/pension starting date was after July1, 1986, or

* Your annuity starting date was after November 18, 1996, and both of the following apply: 1. The payments are from a qualified employee plan, a qualified employee annuity, or a tax-sheltered annuity, and 2. On your annuity starting date, either you were under age 75 or the number of years of guaranteed payments was fewer than 5.

 b.     General Rule – used if you don’t qualify for Simplified Method

Note: Your contributions are reflected in box 5, Form 1099-R. You may contact your plan administrator, if you are unsure of your pension/ annuity start date.

The "plan cost at annuity start date" refers to your total after-tax contributions in the plan, if you made any. If you did not make any after-tax contributions into these accounts, enter "0" (zero) in the plan cost entry.

If you did make after-tax contributions and have a 1099-R, it may be listed in box 9b. If the information is not listed there, you must find it in your records or contact your annuity administrator. It will be beneficial to find this information, as it may reduce your taxable income

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1 Reply
Coleen3
Intuit Alumni

There is no Simplified Method Line 3 on our 1099-Rs. What am I to do?

If you made any after-tax contributions to your pension/annuity plan, you can exclude part of your pension/annuity from taxable income.  Generally, you must figure the tax-free part when the first payments begin. 

To determine how much of your pension is taxable and how much is tax free, you must use:

a.      Simplified Method

*you must use it if your annuity/pension starting date was after July1, 1986, or

* Your annuity starting date was after November 18, 1996, and both of the following apply: 1. The payments are from a qualified employee plan, a qualified employee annuity, or a tax-sheltered annuity, and 2. On your annuity starting date, either you were under age 75 or the number of years of guaranteed payments was fewer than 5.

 b.     General Rule – used if you don’t qualify for Simplified Method

Note: Your contributions are reflected in box 5, Form 1099-R. You may contact your plan administrator, if you are unsure of your pension/ annuity start date.

The "plan cost at annuity start date" refers to your total after-tax contributions in the plan, if you made any. If you did not make any after-tax contributions into these accounts, enter "0" (zero) in the plan cost entry.

If you did make after-tax contributions and have a 1099-R, it may be listed in box 9b. If the information is not listed there, you must find it in your records or contact your annuity administrator. It will be beneficial to find this information, as it may reduce your taxable income

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