1099-R form from Ohio Public Employees - how to report Turbo Tax 16 question re: State Distribution Amount

[Lgruber1]

From prior answers on this site, it appears that the 1099R form from the Ohio Public Employees Retirement System is outdated as it contains no boxes numbered past 13, but the partial workaround is as follows:

Use Ohio 1099R Box 12 (state tax withheld) to complete Turbo Tax Box 14

Use Ohio 1099R Box 13 ( state ID number) to complete TT box 15

But, my question is how to complete the Turbo Tax question for  box 16, which requests the State Distribution Amount, given the fact that the OH form does not provide this info? 

Thanks for any help!

[SteamTrain]

The state distribution amount is the value that is in box 2a.

BUT

if box 2a is empty, then it is the Federally-taxable amount of box 1  (which is usually just box 1, but can be lower if there were extra after-tax contributions you made to that retirement fund))

[Lgruber1]

I called OPERS today and was advised to simply put the same number in both box 14 (state withholding amount)  and Box 16 (state distribution amount). 

this is different from what was recommended by the TT community, which was to use the 2a box info (or Box 1, if 2a is empty) to complete Box 16

so, any other thought on this? I was a bit surprised by info OPERS gave me and need to figure out correct approach.

thx.

[npierson7]

Please do not do what  OPERS employee told you to do with the form. It will create an error. Put the gross distribution amount form box 1 as a state distribution amount, that's a correct way to handle it. 

[SteamTrain]

OK, I'll admit I don't have enough detailed knowledge of the Ohio software to know for sure whether the value of box 1 or box 2a needs to be entered as the State distribution amount (box 16) and how the Ohio software uses that value.  Certainly, if box 1 = 2a, then it makes no difference.

BUT

For many states, where the state allows an income subtraction of distributions from their own state's employee retirement system, or Teachers/police municipal pensions  (Ohio apparently does not),  they start with the Federal AGI, and subtract the pension amount for that particular 1099-R form....but only to the extent of what was included in the Federal AGI in the first place...and that is the box 2a value (when it has a real value somewhat lower than box 1).    That 2a is the value put into box 16 for these other states.

For other states, they have a certain allowed state income deduction amount for any 1099-R, and that amount may have some "up-to"  limit.  Again, only up-to the retirement income included in in the Federal AGI in the first place.  If the state allows up-to a 10,000 state income deduction for any pension, and box 1 is 13,000, and 2a is 8,000, then the state distribution amount needs to be 2a, because only 8k can be deducted, since only 8,000 was included in the Federal AGI in the first place.

Ohio?  I really don't know the details of how that box 16 state distribution is used

[Lgruber1]

FYI, I contacted OPERS again on 3/5/21 and requested a written response to my question re: what is the “state distribution amount”.

Here is the response I received from the benefitquestions mailbox at OPERS:

“Box 14 on the IRS 1099-R is State Distribution, since OPERS only withholds taxes for the State of Ohio this box is not necessary. Box 12 and 13 on the OPERS 1099-R shows the state tax withholding information. The IRS allows entities to modify the 1099-R so long as it has the information that they require.

Thank you,

OPERS”

The OPERS response is still a bit confusing of an answer, as it not clear then, in the TT format, whether box 14 and 16 should reflect the same number - the state tax withholding amount, or whether Box 16 should simply be left blank, as is ‘not necessary’. 

any additional thoughts?

[SteamTrain]

1)  Box 14 and 16 should virtually never be the same number.  I can't say it would never happen...but maybe 1-in-100,000.

2) the person at OPERS you talked to is ignorant about the fact that their 1099-R forms were issued improperly with 2019 box numbers, and not proper 2020 box numbers.

________________________________________________

so your initial comment still applies:

"Use Ohio 1099R Box 12 (state tax withheld) to complete Turbo Tax Box 14

Use Ohio 1099R Box 13 ( state ID number) to complete TT box 15"

___________________________________________________________________

 But as to the Ohio Distribution amount (which will end up in box 16), I really don't know for Ohio..

@Hal_Al 

IF box 1 is $20,000 and 2a is  $10,000 due to after-tax contributions  (I have had that situation, but I'm not in Ohio)....which is the Ohio distribution amount?

OH seems to do a calculated tax credit for retirement distributions included in gross income...but I think only to extent that any retirement income was included in Federal AGI in the first place?  and  that would be box 2a of the 1099-R.  At least that is my reading/reasoning of the credit on page 19 of the 2020 Ohio Instructions (PDF).

[Hal_Al]

The box 16 amount is irrelevant, other than a basis for the withholding in box 14.  Put anything (more than box 14) in there to satisfy TT.  I agree with SteamTrain, it's usually the same as box 2a or box 1.

The Ohio retirement credit is based on Ohio Adjusted gross Income, which is based on the Federal AGI.  There are no Ohio adjustments. 

[Lgruber1]

Thank you for all the input.

Just so I’m clear, for Box 16 in TT (state distribution amount),  for reporting OPERS 1099r income, the options raised were use:

a) Box 2a (taxable amount) or 1(gross distribution), with use of 2a if different amount than box 1;

b) leave blank (if TT allows this);

c) same amount as provided on Ohio 1099r box 14 (state withholding amount);or 

d) $0

e) other? _________________

The TT community consensus seems to be option a) above, but just want to doublecheck. 

Many, many thanks!

[Hal_Al · Accepted solution]

Yes, use the amount in box 2a