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1040 Ez Form

1040 ez form 14. 1040 ez form   Excise Taxes Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Fuels Used in FarmingBuyer of fuel, including undyed diesel fuel or undyed kerosene. 1040 ez form Undyed diesel fuel, undyed kerosene, and Other Fuels (including alternative fuel). 1040 ez form Custom application of fertilizer and pesticide. 1040 ez form Fuel not used for farming. 1040 ez form Dyed Diesel Fuel and Dyed Kerosene Fuels Used in Off-Highway Business Use Fuels Used for Household Purposes or Other Than as a Fuel for Propulsion Engines How To Claim a Credit or RefundCredit only. 1040 ez form Claiming a Credit Claiming a Refund Including the Credit or Refund in Income Introduction You may be eligible to claim a credit on your income tax return for the federal excise tax on certain fuels. 1040 ez form You may also be eligible to claim a quarterly refund of the fuel taxes during the year, instead of waiting to claim a credit on your income tax return. 1040 ez form Whether you can claim a credit or refund depends on whether the fuel was taxed and the purpose (nontaxable use) for which you used the fuel. 1040 ez form The nontaxable uses of fuel for which a farmer may claim a credit or refund are generally the following. 1040 ez form Use on a farm for farming purposes. 1040 ez form Off-highway business use. 1040 ez form Uses other than as a fuel in a propulsion engine, such as home use. 1040 ez form Table 14-1 presents an overview of credits and refunds that may be claimed for fuels used for the nontaxable uses listed above. 1040 ez form See Publication 510, Excise Taxes, for more information. 1040 ez form Topics - This chapter discusses: Fuels used in farming Dyed diesel fuel and dyed kerosene Fuels used in off-highway business use Fuels used for household purposes How to claim a credit or refund Including the credit or refund in income Useful Items - You may want to see: Publication 510 Excise Taxes Form (and Instructions) 720 Quarterly Federal Excise Tax Return 4136 Credit for Federal Tax Paid on Fuels 8849 Claim for Refund of Excise Taxes See chapter 16 for information about getting publications and forms. 1040 ez form Fuels Used in Farming Owners, operators, and tenants of farms and certain other persons may be eligible to claim a credit or refund of excise taxes on fuel used in the trade or business of farming, when used on a farm in the United States for farming purposes. 1040 ez form See Table 14-1 for a list of available fuel tax credits and refunds. 1040 ez form Fuel is used on a farm for farming purposes only if used in carrying on a trade or business of farming, on a farm in the United States, and for farming purposes. 1040 ez form Farm. 1040 ez form   A farm includes livestock, dairy, fish, poultry, fruit, fur-bearing animals, and truck farms, orchards, plantations, ranches, nurseries, ranges, and feed yards for finishing cattle. 1040 ez form It also includes structures such as greenhouses used primarily for raising agricultural or horticultural commodities. 1040 ez form A fish farm is an area where fish are grown or raised and not merely caught or harvested. 1040 ez form Table 14-1. 1040 ez form Fuel Tax Credits and Refunds at a Glance Use this table to see if you can take a credit or refund for a nontaxable use of the fuel listed. 1040 ez form Fuel Used On a Farm for Farming Purposes Off-Highway Business Use Household Use or Use Other Than as a Fuel1 Gasoline Credit only Credit or refund None Aviation gasoline Credit only None None Undyed diesel fuel and undyed kerosene Credit or refund Credit or refund2 Credit or refund2 Kerosene for use in aviation Credit or refund None None Dyed diesel fuel and dyed kerosene None None None Other Fuels (including alternative fuels)3 Credit or refund Credit or refund None 1For a use other than as fuel in a propulsion engine. 1040 ez form 2Applies to undyed kerosene not sold from a blocked pump or, under certain circumstances, for blending with undyed diesel fuel to be used for heating purposes. 1040 ez form See Reg. 1040 ez form 48. 1040 ez form 6427-10 (b)(1) for the definition of a blocked pump. 1040 ez form 3Other Fuels means any liquid except gas oil, fuel oil, or any product taxable under Internal Revenue Code section 4081. 1040 ez form It includes the alternative fuels: liquefied petroleum gas (LPG),“P” Series fuels, compressed natural gas (CNG), liquefied hydrogen, any liquid fuel derived from coal (including peat) through the Fischer-Tropsch process, liquid fuel derived from biomass, liquid natural gas (LNG), liquefied gas derived from biomass, and compressed gas derived from biomass. 1040 ez form Farming purposes. 1040 ez form   As the owner, tenant, or operator and the ultimate purchaser of fuel that you purchased, you use the fuel on a farm for farming purposes if you use it in any of the following ways. 1040 ez form To cultivate the soil or to raise or harvest any agricultural or horticultural commodity. 1040 ez form To raise, shear, feed, care for, train, or manage livestock, bees, poultry, fur-bearing animals, or wildlife. 1040 ez form To operate, manage, conserve, improve, or maintain your farm and its tools and equipment. 1040 ez form To handle, dry, pack, grade, or store any raw agricultural or horticultural commodity. 1040 ez form For this use to qualify, you must have produced more than half the commodity so treated during the tax year. 1040 ez form The more-than-one-half test applies separately to each commodity. 1040 ez form Commodity means a single raw product. 1040 ez form For example, apples and peaches are two separate commodities. 1040 ez form To plant, cultivate, care for, or cut trees or to prepare (other than sawing logs into lumber, chipping, or other milling) trees for market, but only if these activities are incidental to your farming operations. 1040 ez form Your tree operations are incidental only if they are minor in nature when compared to the total farming operations. 1040 ez form   If any other person, such as a neighbor or custom operator (independent contractor), performs a service for you on your farm for any of the purposes included in list items (1) or (2), above, you are considered to be the ultimate purchaser who used the fuel on a farm for farming purposes. 1040 ez form Therefore, you can still claim the credit or refund for the fuel so used. 1040 ez form However, see Custom application of fertilizer and pesticide, later. 1040 ez form If the other person performs any other services for you on your farm for purposes not included in list items (1) or (2) above, no one can claim the credit or refund for fuel used on your farm for those other services. 1040 ez form Buyer of fuel, including undyed diesel fuel or undyed kerosene. 1040 ez form   If doubt exists whether the owner, tenant, or operator of the farm bought the fuel, determine who actually bore the cost of the fuel. 1040 ez form For example, if the owner of a farm and his or her tenant equally share the cost of gasoline used on the farm, each can claim a credit for the tax on half the fuel used. 1040 ez form Undyed diesel fuel, undyed kerosene, and Other Fuels (including alternative fuel). 1040 ez form   Usually, the farmer is the only person who can make a claim for credit or refund for the tax on undyed diesel fuel, undyed kerosene, or other fuels (including alternative fuel) used for farming purposes. 1040 ez form However, see Custom application of fertilizer and pesticide, next. 1040 ez form Also see Dyed Diesel Fuel and Dyed Kerosene, later. 1040 ez form Example. 1040 ez form Farm owner Haleigh Blue hired custom operator Tyler Steele to cultivate the soil on her farm. 1040 ez form Tyler used 200 gallons of undyed diesel fuel that he purchased to perform the work on Haleigh's farm. 1040 ez form In addition, Haleigh hired contractor Lee Brown to pack and store her apple crop. 1040 ez form Lee bought 25 gallons of undyed diesel fuel to use in packing the apples. 1040 ez form Haleigh can claim the credit for the 200 gallons of undyed diesel fuel used by Tyler on her farm because it qualifies as fuel used on the farm for farming purposes. 1040 ez form No one can claim a credit for the 25 gallons used by Lee because that fuel was not used for a farming purpose included in list items (1) or (2), above. 1040 ez form In the above example, both Tyler Steele and Lee Brown could have purchased dyed (untaxed) diesel fuel for their tasks. 1040 ez form Custom application of fertilizer and pesticide. 1040 ez form   Fuel used on a farm for farming purposes includes fuel used in the application (including aerial application) of fertilizer, pesticides, or other substances. 1040 ez form Generally, the applicator is treated as having used the fuel on a farm for farming purposes. 1040 ez form For applicators using highway vehicles, only the fuel used on the farm is exempt. 1040 ez form Fuel used traveling on the highway to and from the farm is taxable. 1040 ez form Fuel used by an aerial applicator for the direct flight between the airfield and one or more farms is treated as used for a farming purpose. 1040 ez form For aviation gasoline, the aerial applicator makes the claim as the ultimate purchaser. 1040 ez form For kerosene used in aviation, the ultimate purchaser may make the claim or waive the right to make the claim to the registered ultimate vendor. 1040 ez form A sample waiver is included as Model Waiver L in the appendix of Publication 510. 1040 ez form A registered ultimate vendor is the person who sells undyed diesel fuel, undyed kerosene, or kerosene for use in aviation to the user (ultimate purchaser) of the fuel for use on a farm for farming purposes. 1040 ez form To claim a credit or refund of tax, the ultimate vendor must be registered with the Internal Revenue Service at the time the claim is made. 1040 ez form However, registered ultimate vendors cannot make claims for undyed diesel fuel and undyed kerosene sold for use on a farm for farming purposes. 1040 ez form Fuel not used for farming. 1040 ez form   You do not use fuel on a farm for farming purposes when you use it in any of the following ways. 1040 ez form Off the farm, such as on the highway or in noncommercial aviation, even if the fuel is used in transporting livestock, feed, crops, or equipment. 1040 ez form For personal use, such as lawn mowing. 1040 ez form In processing, packaging, freezing, or canning operations. 1040 ez form In processing crude gum into gum spirits of turpentine or gum resin or in processing maple sap into maple syrup or maple sugar. 1040 ez form All-terrain vehicles (ATVs). 1040 ez form   Fuel used in ATVs on a farm for farming purposes, discussed earlier, is eligible for a credit or refund of excise taxes on the fuel. 1040 ez form Fuel used in ATVs for nonfarming purposes is not eligible for a credit or refund of the taxes. 1040 ez form If ATVs are used both for farming and nonfarming purposes, only that portion of the fuel used for farming purposes is eligible for the credit or refund. 1040 ez form Dyed Diesel Fuel and Dyed Kerosene If you purchase dyed diesel fuel or dyed kerosene for a nontaxable use, you must use it only on a farm for farming purposes or for other nontaxable purposes. 1040 ez form For example, you should not use dyed diesel fuel in a truck that is used both on the farm for farming purposes and on the highway, even though the highway use is in connection with farm business. 1040 ez form Excise tax applies to the fuel used by the truck on the highways. 1040 ez form In this situation, undyed (taxed) fuel should be purchased for the truck. 1040 ez form You should keep fuel records of the use of the truck on the farm for farming purposes, and for other uses. 1040 ez form You may be eligible for a credit or refund for the excise tax on fuel used on the farm for farming purposes. 1040 ez form Penalty. 1040 ez form   A penalty is imposed on any person who knowingly uses, sells, or alters dyed diesel fuel or dyed kerosene for any purpose other than a nontaxable use. 1040 ez form The penalty is the greater of $1,000 or $10 per gallon of the dyed diesel fuel or dyed kerosene involved. 1040 ez form After the first violation, the $1,000 portion of the penalty increases depending on the number of violations. 1040 ez form For more information on this penalty, see Publication 510. 1040 ez form Fuels Used in Off-Highway Business Use You may be eligible to claim a credit or refund for the excise tax on fuel used in an off-highway business use. 1040 ez form Off-highway business use. 1040 ez form   This is any use of fuel in a trade or business or in an income-producing activity. 1040 ez form The use must not be in a highway vehicle registered or required to be registered for use on public highways. 1040 ez form Off-highway business use generally does not include any use in a recreational motorboat. 1040 ez form Examples. 1040 ez form   Off-highway business use includes the use of fuels in a trade or business in any of the following ways. 1040 ez form In stationary machines such as generators, compressors, power saws, and similar equipment; For cleaning ; and In forklift trucks, bulldozers, and earthmovers. 1040 ez form   Off-highway nonbusiness (taxable) use of fuel includes: use in minibikes, snowmobiles, power lawn mowers, chain saws, and other yard equipment. 1040 ez form For more information, see Publication 510. 1040 ez form Fuels Used for Household Purposes or Other Than as a Fuel for Propulsion Engines You may be eligible to claim a credit or refund for the excise tax on undyed diesel fuel or kerosene used for home heating, lighting, and cooking. 1040 ez form This also applies to diesel fuel and kerosene used in a home generator to produce electricity for home use. 1040 ez form Home use of a fuel does not include use in a propulsion engine and it is not considered an off-highway business use. 1040 ez form How To Claim a Credit or Refund You may be able to claim a credit or refund of the excise tax on fuels you use for nontaxable uses. 1040 ez form The basic rules for claiming credits and refunds are listed in Table 14-2 . 1040 ez form Table 14-2. 1040 ez form Claiming a Credit or Refund of Excise Taxes This table gives the basic rules for claiming a credit or refund of excise taxes on fuels used for a nontaxable use. 1040 ez form   Credit Refund Which form to use Form 4136, Credit for Federal Tax Paid on Fuels Form 8849, Claim for Refund of Excise Taxes, and Schedule 1 (Form 8849), Nontaxable Use of Fuels Type of form Annual Quarterly When to file With your income tax return By the last day of the quarter following the last quarter included in the claim Amount of tax Any amount $750 or more1 1You may carry over an amount less than $750 to the next quarter. 1040 ez form Keep at your principal place of business all records needed to enable the IRS to verify that you are the person entitled to claim a credit or refund and the amount you claimed. 1040 ez form You do not have to use any special form, but the records should establish the following information. 1040 ez form The total number of gallons bought and used during the period covered by your claim. 1040 ez form The dates of the purchases. 1040 ez form The names and addresses of suppliers and amounts bought from each during the period covered by your claim. 1040 ez form The nontaxable use for which you used the fuel. 1040 ez form The number of gallons used for each nontaxable use. 1040 ez form It is important that your records separately show the number of gallons used for each nontaxable use that qualifies as a claim. 1040 ez form For more information about recordkeeping, see Publication 583, Starting a Business and Keeping Records. 1040 ez form Credit or refund. 1040 ez form   A credit is an amount that reduces the tax on your income tax return when you file it at the end of the year. 1040 ez form If you meet certain requirements, you may claim a refund during the year instead of waiting until you file your income tax return. 1040 ez form Credit only. 1040 ez form   You can claim the following taxes only as a credit on your income tax return. 1040 ez form Tax on gasoline and aviation gasoline you used on a farm for farming purposes. 1040 ez form Tax on fuels (including undyed diesel fuel or undyed kerosene) you used for nontaxable uses if the total for the tax year is less than $750. 1040 ez form Tax on fuel you did not include in any claim for refund previously filed for any quarter of the tax year. 1040 ez form Claiming a Credit You make a claim for a fuel tax credit on Form 4136 and attach it to your income tax return. 1040 ez form Do not claim a credit for any excise tax for which you have filed a refund claim. 1040 ez form How to claim a credit. 1040 ez form   How you claim a credit depends on whether you are an individual, partnership, corporation, S corporation, trust, or farmers' cooperative association. 1040 ez form Individuals. 1040 ez form   You claim the credit on the “Credit for federal tax on fuels” line of your Form 1040. 1040 ez form If you would not otherwise have to file an income tax return, you must do so to get a fuel tax credit. 1040 ez form Partnership. 1040 ez form   Partnerships (other than electing large partnerships) claim the credit by including a statement on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. 1040 ez form , showing each partner's share of the number of gallons of each fuel sold or used for a nontaxable use, the type of use, and the applicable credit per gallon. 1040 ez form Each partner claims the credit on his or her income tax return for the partner's share of the fuel used by the partnership. 1040 ez form An electing large partnership can claim the credit on the “Other payments” line of Form 1065-B, U. 1040 ez form S. 1040 ez form Return of Income for Electing Large Partnerships. 1040 ez form Other entities. 1040 ez form   Corporations, S corporations, farmers' cooperative associations, and trusts make the claim on the appropriate line of their income tax return. 1040 ez form When to claim a credit. 1040 ez form   You can claim a fuel tax credit on your income tax return for the year you used the fuel. 1040 ez form You may be able to make a fuel tax claim on an amended income tax return for the year you used the fuel. 1040 ez form A claim for credit or refund of an overpayment must generally be filed within the later of: Three years from the date the original return was filed, or Two years from the date the tax was paid. 1040 ez form Claiming a Refund Generally, you may claim a refund of excise taxes on Form 8849. 1040 ez form Complete and attach to Form 8849 the appropriate Form 8849 schedule(s). 1040 ez form The instructions for Form 8849 and the separate instructions for each schedule explain the requirements for making a claim for refund. 1040 ez form If you file Form 720, you can use its Schedule C for your refund claims for the quarter. 1040 ez form See the Instructions for Form 720. 1040 ez form Do not claim a refund on Form 8849 for any amount for which you have filed or will file a claim on Form 720 or Form 4136. 1040 ez form You may file a claim for refund for any quarter of your tax year for which you can claim $750 or more. 1040 ez form This amount is the excise tax on all fuels used for a nontaxable use during that quarter or any prior quarter (for which no other claim has been filed) during the tax year. 1040 ez form If you cannot claim at least $750 at the end of a quarter, you carry the amount over to the next quarter of your tax year to determine if you can claim at least $750 for that quarter. 1040 ez form If you cannot claim at least $750 at the end of the fourth quarter of your tax year, you must claim a credit on your income tax return using Form 4136. 1040 ez form Only one claim can be filed for a quarter. 1040 ez form You cannot claim a refund for excise tax on gasoline and aviation gasoline used on a farm for farming purposes. 1040 ez form You must claim a credit on your income tax return for the tax. 1040 ez form How to file a quarterly claim. 1040 ez form   File the claim for refund by filling out Schedule 1 (Form 8849) and attaching it to Form 8849. 1040 ez form Send it to the address shown in the instructions. 1040 ez form If you file Form 720, you can use its Schedule C for your refund claims. 1040 ez form See the Instructions for Form 720. 1040 ez form When to file a quarterly claim. 1040 ez form   You must file a quarterly claim by the last day of the first quarter following the last quarter included in the claim. 1040 ez form If you do not file a timely refund claim for the fourth quarter of your tax year, you will have to claim a credit for that amount on your income tax return, as discussed earlier. 1040 ez form    In most situations, the amount claimed as a credit or refund will be less than the amount deducted as fuel tax expense because the Leaking Underground Storage Tank (LUST) tax of $0. 1040 ez form 001 per gallon is generally not subject to credit or refund. 1040 ez form Including the Credit or Refund in Income Include any credit or refund of excise taxes on fuels in your gross income if you claimed the total cost of the fuel (including the excise taxes) as an expense deduction that reduced your income tax liability. 1040 ez form Which year you include a credit or refund in gross income depends on whether you use the cash or an accrual method of accounting. 1040 ez form Cash method. 1040 ez form   If you use the cash method and file a claim for refund, include the refund amount in gross income for the tax year in which you receive the refund. 1040 ez form If you claim a credit on your income tax return, include the credit amount in gross income for the tax year in which you file Form 4136. 1040 ez form If you file an amended return and claim a credit, include the credit amount in gross income for the tax year in which you receive the credit. 1040 ez form Example. 1040 ez form Sharon Brown, a farmer who uses the cash method, filed her 2012 Form 1040 on March 3, 2013. 1040 ez form On her Schedule F, she deducted the total cost of gasoline (including $110 of excise taxes) used on the farm for farming purposes. 1040 ez form Then, on Form 4136, she claimed the $110 as a credit. 1040 ez form Sharon reports the $110 as other income on line 8b of her 2013 Schedule F. 1040 ez form Accrual method. 1040 ez form   If you use an accrual method, include the amount of credit or refund in gross income for the tax year in which you used the fuels. 1040 ez form It does not matter whether you filed for a quarterly refund or claimed the entire amount as a credit. 1040 ez form Example. 1040 ez form Patty Green, a farmer who uses the accrual method, files her 2012 Form 1040 on April 15, 2013. 1040 ez form On Schedule F, she deducts the total cost of gasoline (including $155 of excise taxes) she used on the farm for farming purposes during 2012. 1040 ez form On Form 4136, Patty claims the $155 as a credit. 1040 ez form She reports the $155 as other income on line 8b of her 2012 Schedule F. 1040 ez form Prev  Up  Next   Home   More Online Publications
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Consumer Protection Offices

City, county, regional, and state consumer offices offer a variety of important services. They might mediate complaints, conduct investigations, prosecute offenders of consumer laws, license and regulate professional service providers, provide educational materials and advocate for consumer rights. To save time, call before sending a written complaint. Ask if the office handles the type of complaint you have and if complaint forms are provided.

State Consumer Protection Offices

Oklahoma Attorney General

Website: Oklahoma Attorney General

Address: Oklahoma Attorney General
Public Protection Unit
313 N.E. 21st St.
Oklahoma City, OK 73105

Phone Number: 405-521-3921 (Oklahoma City) 918-581-2885 (Tulsa)

Oklahoma Department of Consumer Credit

Website: Oklahoma Department of Consumer Credit

Address: Oklahoma Department of Consumer Credit
3613 N.W. 56th St., Suite 240
Oklahoma City, OK 73112-4512

Phone Number: 405-521-3653

Toll-free: 1-800-448-4904 (Consumer Hotline)

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Banking Authorities

The officials listed in this section regulate and supervise state-chartered banks. Many of them handle or refer problems and complaints about other types of financial institutions as well. Some also answer general questions about banking and consumer credit. If you are dealing with a federally chartered bank, check Federal Agencies.

State Banking Department

Website: State Banking Department

Address: State Banking Department
2900 N. Lincoln Blvd.
Oklahoma City, OK 73105

Phone Number: 405-521-2782

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Insurance Regulators

Each state has its own laws and regulations for each type of insurance. The officials listed in this section enforce these laws. Many of these offices can also provide you with information to help you make informed insurance buying decisions.

Insurance Department

Website: Insurance Department

Address: Insurance Department
Consumer Assistance Division
Five Corporate Plaza
3625 N.W. 56th St., Suite 100
Oklahoma City, OK 73112

Phone Number: 405-521-2991

Toll-free: 1-800-522-0071 (OK)

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Securities Administrators

Each state has its own laws and regulations for securities brokers and securities - including stocks, mutual funds, commodities, real estate, etc. The officials and agencies listed in this section enforce these laws and regulations. Many of these offices can also provide information to help you make informed investment decisions.

Department of Securities

Website: Department of Securities

Address: Department of Securities
First National Center
120 N. Robinson Ave., Suite 860
Oklahoma City, OK 73102

Phone Number: 405-280-7700

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Utility Commissions

State Utility Commissions regulate services and rates for gas, electricity and telephones within your state. In some states, the utility commissions regulate other services such as water, transportation, and the moving of household goods. Many utility commissions handle consumer complaints. Sometimes, if a number of complaints are received about the same utility matter, they will conduct investigations.

Corporation Commission

Website: Corporation Commission

Address: Corporation Commission
Consumer Services Division
PO Box 52000
Oklahoma City, OK 73152-2000

Phone Number: 405-522-0478

Toll-free: 1-800-522-8154 (OK)

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The 1040 Ez Form

1040 ez form Publication 721 - Main Content Table of Contents Part I General InformationRefund of Contributions Tax Withholding and Estimated Tax Filing Requirements Part II Rules for RetireesAnnuity starting date. 1040 ez form Gross monthly rate. 1040 ez form Your cost. 1040 ez form Choosing a survivor annuity after retirement. 1040 ez form Canceling a survivor annuity after retirement. 1040 ez form Annuity starting date after 1986. 1040 ez form Annuity starting date before 1987. 1040 ez form Simplified Method General Rule Three-Year Rule Alternative Annuity Option Federal Gift Tax Retirement During the Past Year Reemployment After Retirement Nonresident Aliens Thrift Savings Plan Rollover Rules Distributions Used To Pay Insurance Premiums for Public Safety Officers How To Report Benefits Part III Rules for Disability Retirement and Credit for the Elderly or the DisabledDisability Annuity Other Benefits Credit for the Elderly or the Disabled Part IV Rules for Survivors of Federal EmployeesFERS Death Benefit CSRS or FERS Survivor Annuity Lump-Sum CSRS or FERS Payment Thrift Savings Plan Federal Estate Tax Part V Rules for Survivors of Federal RetireesCSRS or FERS Survivor Annuity Lump-Sum CSRS or FERS Payment Voluntary Contributions Thrift Savings Plan Federal Estate Tax Income Tax Deduction for Estate Tax Paid How To Get Tax HelpLow Income Taxpayer Clinics Part I General Information This part of the publication contains information that can apply to most recipients of civil service retirement benefits. 1040 ez form Refund of Contributions If you leave federal government service or transfer to a job not under the CSRS or FERS and you are not eligible for an immediate annuity, you can choose to receive a refund of the money in your CSRS or FERS retirement account. 1040 ez form The refund will include both regular and voluntary contributions you made to the fund, plus any interest payable. 1040 ez form If the refund includes only your contributions, none of the refund is taxable. 1040 ez form If it includes any interest, the interest is taxable unless you roll it over directly into another qualified plan or a traditional individual retirement arrangement (IRA). 1040 ez form If you do not have the Office of Personnel Management (OPM) transfer the interest to an IRA or other plan in a direct rollover, tax will be withheld at a 20% rate. 1040 ez form See Rollover Rules in Part II for information on how to make a rollover. 1040 ez form Interest is not paid on contributions to the CSRS for service after 1956 unless your service was for more than 1 year but not more than 5 years. 1040 ez form Therefore, many employees who withdraw their contributions under the CSRS do not get interest and do not owe any tax on their refund. 1040 ez form If you do not roll over interest included in your refund, it may qualify as a lump-sum distribution eligible for capital gain treatment or the 10-year tax option. 1040 ez form If you separate from service before the calendar year in which you reach age 55, it may be subject to an additional 10% tax on early distributions. 1040 ez form For more information, see Lump-Sum Distributions and Tax on Early Distributions in Publication 575. 1040 ez form A lump-sum distribution is eligible for capital gain treatment or the 10-year tax option only if the plan participant was born before January 2, 1936. 1040 ez form Tax Withholding and Estimated Tax The CSRS or FERS annuity you receive is subject to federal income tax withholding, unless you choose not to have tax withheld. 1040 ez form OPM will tell you how to make the choice. 1040 ez form The choice for no withholding remains in effect until you change it. 1040 ez form These withholding rules also apply to a disability annuity, whether received before or after minimum retirement age. 1040 ez form If you choose not to have tax withheld, or if you do not have enough tax withheld, you may have to make estimated tax payments. 1040 ez form You may owe a penalty if the total of your withheld tax and estimated tax does not cover most of the tax shown on your return. 1040 ez form Generally, you will owe the penalty for 2014 if the additional tax you must pay with your return is $1,000 or more and more than 10% of the tax to be shown on your 2014 return. 1040 ez form For more information, including exceptions to the penalty, see chapter 4 of Publication 505, Tax Withholding and Estimated Tax. 1040 ez form Form CSA 1099R. 1040 ez form   Form CSA 1099R is mailed to you by OPM each year. 1040 ez form It will show any tax you had withheld. 1040 ez form File a copy of Form CSA 1099R with your tax return if any federal income tax was withheld. 1040 ez form    You also can view and download your Form CSA 1099R by visiting the OPM website at  www. 1040 ez form servicesonline. 1040 ez form opm. 1040 ez form gov. 1040 ez form To log in, you will need your retirement CSA claim number and your personal identification number. 1040 ez form Choosing no withholding on payments outside the United States. 1040 ez form   The choice for no withholding generally cannot be made for annuity payments to be delivered outside the United States and its possessions. 1040 ez form   To choose no withholding if you are a U. 1040 ez form S. 1040 ez form citizen or resident alien, you must provide OPM with your home address in the United States or its possessions. 1040 ez form Otherwise, OPM has to withhold tax. 1040 ez form For example, OPM must withhold if you provide a U. 1040 ez form S. 1040 ez form address for a nominee, trustee, or agent (such as a bank) to whom the benefits are to be delivered, but you do not provide your own U. 1040 ez form S. 1040 ez form home address. 1040 ez form   If you do not provide a home address in the United States or its possessions, you can choose not to have tax withheld only if you certify to OPM that you are not a U. 1040 ez form S. 1040 ez form citizen, a U. 1040 ez form S. 1040 ez form resident alien, or someone who left the United States to avoid tax. 1040 ez form But if you so certify, you may be subject to the 30% flat rate withholding that applies to nonresident aliens. 1040 ez form For details, see Publication 519, U. 1040 ez form S. 1040 ez form Tax Guide for Aliens. 1040 ez form Withholding certificate. 1040 ez form   If you give OPM a Form W-4P-A, Election of Federal Income Tax Withholding, you can choose not to have tax withheld or you can choose to have tax withheld. 1040 ez form The amount of tax withheld depends on your marital status, the number of withholding allowances, and any additional amount you designate to be withheld. 1040 ez form If you do not make either of these choices, OPM must withhold as if you were married with three withholding allowances. 1040 ez form To change the amount of tax withholding or to stop withholding, call OPM's Retirement Information Office at 1-888-767-6738 (customers within the local Washington, D. 1040 ez form C. 1040 ez form calling area must call 202-606-0500). 1040 ez form No special form is needed. 1040 ez form You will need your retirement CSA or CSF claim number, your social security number, and your personal identification number (PIN) when you call. 1040 ez form If you have TTY/TDD equipment, call 1-855–887–4957. 1040 ez form If you need a PIN, call OPM's Retirement Information Office. 1040 ez form You also can change the amount of withholding or stop withholding online by visiting the OPM website at www. 1040 ez form servicesonline. 1040 ez form opm. 1040 ez form gov. 1040 ez form You will need your retirement CSA or CSF claim number and your PIN. 1040 ez form Withholding from certain lump-sum payments. 1040 ez form   If you leave the federal government before becoming eligible to retire and you apply for a refund of your CSRS or FERS contributions, or you die without leaving a survivor eligible for an annuity, you or your beneficiary will receive a distribution of your contributions to the retirement plan plus any interest payable. 1040 ez form Tax will be withheld at a 20% rate on the interest distributed. 1040 ez form However, tax will not be withheld if you have OPM transfer (roll over) the interest directly to your traditional IRA or other qualified plan. 1040 ez form If you have OPM transfer (roll over) the interest directly to a Roth IRA, the entire amount will be taxed in the current year. 1040 ez form Because no income tax will be withheld at the time of the transfer, you may want to increase your withholding or pay estimated taxes. 1040 ez form See Rollover Rules in Part II. 1040 ez form If you receive only your contributions, no tax will be withheld. 1040 ez form Withholding from Thrift Savings Plan payments. 1040 ez form   Generally, a distribution that you receive from the TSP is subject to federal income tax withholding. 1040 ez form The amount withheld is: 20% if the distribution is an eligible rollover distribution, 10% if it is a nonperiodic distribution other than an eligible rollover distribution, or An amount determined as if you were married with three withholding allowances, unless you submit a withholding certificate (Form W-4P), if it is a periodic distribution. 1040 ez form  However, you usually can choose not to have tax withheld from TSP payments other than eligible rollover distributions. 1040 ez form By January 31 after the end of the year in which you receive a distribution, the TSP will issue Form 1099-R showing the total distributions you received in the prior year and the amount of tax withheld. 1040 ez form   For a detailed discussion of withholding on distributions from the TSP, see Important Tax Information About Payments From Your TSP Account, available from your agency personnel office or from the TSP. 1040 ez form The above document is also available in the “Forms & Publications” section of the TSP website at www. 1040 ez form tsp. 1040 ez form gov. 1040 ez form Estimated tax. 1040 ez form   Generally, you must make estimated tax payments for 2014 if you expect to owe at least $1,000 in tax for 2014 (after subtracting your withholding and credits) and you expect your withholding and your credits to be less than the smaller of: 90% of the tax to be shown on your income tax return for 2014, or 100% of the tax shown on your 2013 income tax return (110% of that amount if the adjusted gross income shown on the return was more than $150,000 ($75,000 if your filing status for 2014 will be married filing separately)). 1040 ez form The return must cover all 12 months. 1040 ez form   You do not have to pay estimated tax for 2014 if you were a U. 1040 ez form S. 1040 ez form citizen or resident alien for all of 2013 and you had no tax liability for the full 12-month 2013 tax year. 1040 ez form   Publication 505 contains information that you can use to help you figure your estimated tax payments. 1040 ez form Filing Requirements If your gross income, including the taxable part of your annuity, is less than a certain amount, you generally do not have to file a federal income tax return for that year. 1040 ez form The gross income filing requirements for the tax year are in the instructions to Form 1040, 1040A, or 1040EZ. 1040 ez form Children. 1040 ez form   If you are the surviving spouse of a federal employee or retiree and your monthly annuity check includes a survivor annuity for one or more children, each child's annuity counts as his or her own income (not yours) for federal income tax purposes. 1040 ez form   If your child can be claimed as a dependent, treat the taxable part of his or her annuity as unearned income when applying the filing requirements for dependents. 1040 ez form Form CSF 1099R. 1040 ez form   Form CSF 1099R will be mailed to you by January 31 after the end of each tax year. 1040 ez form It will show the total amount of the annuity you received in the past year. 1040 ez form It also should show, separately, the survivor annuity for a child or children. 1040 ez form Only the part that is each individual's survivor annuity should be shown on that individual's Form 1040 or 1040A. 1040 ez form   If your Form CSF 1099R does not show separately the amount paid to you for a child or children, attach a statement to your return, along with a copy of Form CSF 1099R, explaining why the amount shown on the tax return differs from the amount shown on Form CSF 1099R. 1040 ez form    You also can view and download your Form CSF 1099R by visiting the OPM website at  www. 1040 ez form servicesonline. 1040 ez form opm. 1040 ez form gov. 1040 ez form To log in you will need your retirement CSF claim number and personal identification number. 1040 ez form    You may request a Summary of Payments, showing the amounts paid to you for your child(ren), from OPM by calling OPM's Retirement Information Office at 1-888-767-6738 (customers within the local Washington, D. 1040 ez form C. 1040 ez form calling area must call 202-606-0500). 1040 ez form You will need your CSF claim number and your social security number when you call. 1040 ez form Taxable part of annuity. 1040 ez form   To find the taxable part of a retiree's annuity when applying the filing requirements, see the discussion in Part II, Rules for Retirees , or Part III, Rules for Disability Retirement and Credit for the Elderly or the Disabled , whichever applies. 1040 ez form To find the taxable part of each survivor annuity when applying the filing requirements, see the discussion in Part IV, Rules for Survivors of Federal Employees , or Part V, Rules for Survivors of Federal Retirees , whichever applies. 1040 ez form Part II Rules for Retirees This part of the publication is for retirees who retired on nondisability retirement. 1040 ez form If you retired on disability before you reached your minimum retirement age, see Part III, Rules for Disability Retirement and Credit for the Elderly or the Disabled. 1040 ez form However, on the day after you reach your minimum retirement age, use the rules in this section to report your disability retirement and begin recovering your cost. 1040 ez form Annuity statement. 1040 ez form   The statement you received from OPM when your CSRS or FERS annuity was approved shows the commencing date (the annuity starting date), the gross monthly rate of your annuity benefit, and your total contributions to the retirement plan (your cost). 1040 ez form You will use this information to figure the tax-free recovery of your cost. 1040 ez form Annuity starting date. 1040 ez form   If you retire from federal government service on a regular annuity, your annuity starting date is the commencing date on your annuity statement from OPM. 1040 ez form If something delays payment of your annuity, such as a late application for retirement, it does not affect the date your annuity begins to accrue or your annuity starting date. 1040 ez form Gross monthly rate. 1040 ez form   This is the amount you were to get after any adjustment for electing a survivor's annuity or for electing the lump-sum payment under the alternative annuity option (if either applied) but before any deduction for income tax withholding, insurance premiums, etc. 1040 ez form Your cost. 1040 ez form   Your monthly annuity payment contains an amount on which you have previously paid income tax. 1040 ez form This amount represents part of your contributions to the retirement plan. 1040 ez form Even though you did not receive the money that was contributed to the plan, it was included in your gross income for federal income tax purposes in the years it was taken out of your pay. 1040 ez form   The cost of your annuity is the total of your contributions to the retirement plan, as shown on your annuity statement from OPM. 1040 ez form If you elected the alternative annuity option, it includes any deemed deposits and any deemed redeposits that were added to your lump-sum credit. 1040 ez form (See Lump-sum credit under Alternative Annuity Option, later. 1040 ez form )   If you repaid contributions that you had withdrawn from the retirement plan earlier, or if you paid into the plan to receive full credit for service not subject to retirement deductions, the entire repayment, including any interest, is a part of your cost. 1040 ez form You cannot claim an interest deduction for any interest payments. 1040 ez form You cannot treat these payments as voluntary contributions; they are considered regular employee contributions. 1040 ez form Recovering your cost tax free. 1040 ez form   How you figure the tax-free recovery of the cost of your CSRS or FERS annuity depends on your annuity starting date. 1040 ez form If your annuity starting date is before July 2, 1986, either the Three-Year Rule or the General Rule (both discussed later) applies to your annuity. 1040 ez form If your annuity starting date is after July 1, 1986, and before November 19, 1996, you could have chosen to use either the General Rule or the Simplified Method (discussed later). 1040 ez form If your annuity starting date is after November 18, 1996, you must use the Simplified Method. 1040 ez form   Under both the General Rule and the Simplified Method, each of your monthly annuity payments is made up of two parts: the tax-free part that is a return of your cost, and the taxable part that is the amount of each payment that is more than the part that represents your cost (unless such payment is used for purposes discussed under Distributions Used To Pay Insurance Premiums for Public Safety Officers , later). 1040 ez form The tax-free part is a fixed dollar amount. 1040 ez form It remains the same, even if your annuity is increased. 1040 ez form Generally, this rule applies as long as you receive your annuity. 1040 ez form However, see Exclusion limit , later. 1040 ez form Choosing a survivor annuity after retirement. 1040 ez form    If you retired without a survivor annuity and report your annuity under the Simplified Method, do not change your tax-free monthly amount even if you later choose a survivor annuity. 1040 ez form   If you retired without a survivor annuity and report your annuity under the General Rule, you must figure the tax-free part of your annuity using a new exclusion percentage if you later choose a survivor annuity and take reduced annuity payments. 1040 ez form To figure the new exclusion percentage, reduce your cost by the amount you previously recovered tax free. 1040 ez form Figure the expected return as of the date the reduced annuity begins. 1040 ez form For details on the General Rule, see Publication 939. 1040 ez form Canceling a survivor annuity after retirement. 1040 ez form   If you retired with a survivor annuity payable to your spouse upon your death and you notify OPM that your marriage has ended, your annuity might be increased to remove the reduction for a survivor benefit. 1040 ez form The increased annuity does not change the cost recovery you figured at the annuity starting date. 1040 ez form The tax-free part of each annuity payment remains the same. 1040 ez form    For more information about choosing or canceling a survivor annuity after retirement, contact OPM's Retirement Information Office at 1-888-767-6738 (customers within the local Washington, D. 1040 ez form C. 1040 ez form calling area must call 202-606-0500). 1040 ez form Exclusion limit. 1040 ez form   Your annuity starting date determines the total amount of annuity payments that you can exclude from income over the years. 1040 ez form Annuity starting date after 1986. 1040 ez form   If your annuity starting date is after 1986, the total amount of annuity income that you (or the survivor annuitant) can exclude over the years as a return of your cost cannot exceed your total cost. 1040 ez form Annuity payments you or your survivors receive after the total cost in the plan has been recovered are generally fully taxable. 1040 ez form Example. 1040 ez form Your annuity starting date is after 1986 and you exclude $100 a month under the Simplified Method. 1040 ez form If your cost is $12,000, the exclusion ends after 10 years (120 months). 1040 ez form Thereafter, your entire annuity is generally fully taxable. 1040 ez form Annuity starting date before 1987. 1040 ez form   If your annuity starting date is before 1987, you can continue to take your monthly exclusion figured under the General Rule or Simplified Method for as long as you receive your annuity. 1040 ez form If you chose a joint and survivor annuity, your survivor can continue to take that same exclusion. 1040 ez form The total exclusion may be more than your cost. 1040 ez form Deduction of unrecovered cost. 1040 ez form   If your annuity starting date is after July 1, 1986, and the cost of your annuity has not been fully recovered at your (or the survivor annuitant's) death, a deduction is allowed for the unrecovered cost. 1040 ez form The deduction is claimed on your (or your survivor's) final tax return as a miscellaneous itemized deduction (not subject to the 2%-of-adjusted-gross-income limit). 1040 ez form If your annuity starting date is before July 2, 1986, no tax benefit is allowed for any unrecovered cost at death. 1040 ez form Simplified Method If your annuity starting date is after November 18, 1996, you must use the Simplified Method to figure the tax-free part of your CSRS or FERS annuity. 1040 ez form (OPM has figured the taxable amount of your annuity shown on your Form CSA 1099R using the Simplified Method. 1040 ez form ) You could have chosen to use either the Simplified Method or the General Rule if your annuity starting date is after July 1, 1986, but before November 19, 1996. 1040 ez form The Simplified Method does not apply if your annuity starting date is before July 2, 1986. 1040 ez form Under the Simplified Method, you figure the tax-free part of each full monthly payment by dividing your cost by a number of months based on your age. 1040 ez form This number will differ depending on whether your annuity starting date is before November 19, 1996, or after November 18, 1996. 1040 ez form If your annuity starting date is after 1997 and your annuity includes a survivor benefit for your spouse, this number is based on your combined ages. 1040 ez form Worksheet A. 1040 ez form   Use Worksheet A. 1040 ez form Simplified Method (near the end of this publication), to figure your taxable annuity. 1040 ez form Be sure to keep the completed worksheet. 1040 ez form It will help you figure your taxable amounts for later years. 1040 ez form Instead of Worksheet A, you generally can use the Simplified Method Worksheet in the instructions for Form 1040, Form 1040A, or Form 1040NR to figure your taxable annuity. 1040 ez form However, you must use Worksheet A and Worksheet B in this publication if you chose the alternative annuity option, discussed later. 1040 ez form Line 2. 1040 ez form   See Your cost , earlier, for an explanation of your cost in the plan. 1040 ez form If your annuity starting date is after November 18, 1996, and you chose the alternative annuity option (explained later), you must reduce your cost by the tax-free part of the lump-sum payment you received. 1040 ez form Line 3. 1040 ez form   The number you enter on line 3 is the appropriate number from Table 1 or 2 representing approximate life expectancies in months. 1040 ez form If your annuity starting date is after 1997, use: Table 1 for an annuity without a survivor benefit, or Table 2 for an annuity with a survivor benefit. 1040 ez form If your annuity starting date is before 1998, use Table 1. 1040 ez form Line 6. 1040 ez form   If you received contributions tax free before 2013, the amount previously recovered tax free that you must enter on line 6 is the total amount from line 10 of last year's worksheet. 1040 ez form If your annuity starting date is before November 19, 1996, and you chose the alternative annuity option, this amount includes the tax-free part of the lump-sum payment you received. 1040 ez form Example. 1040 ez form Bill Smith retired from the Federal Government on March 31, 2013, under an annuity that will provide a survivor benefit for his wife, Kathy. 1040 ez form His annuity starting date is April 1, 2013, the annuity is paid in arrears, and he received his first monthly annuity payment on May 1, 2013. 1040 ez form He must use the Simplified Method to figure the tax-free part of his annuity benefits. 1040 ez form Bill's monthly annuity benefit is $1,000. 1040 ez form He had contributed $31,000 to his retirement plan and had received no distributions before his annuity starting date. 1040 ez form At his annuity starting date, he was 65 and Kathy was 57. 1040 ez form Bill's completed Worksheet A is shown later. 1040 ez form To complete line 3, he used Table 2 at the bottom of the worksheet and found that 310 is the number in the second column opposite the age range that includes 122 (his and Kathy's combined ages). 1040 ez form Bill keeps a copy of the completed worksheet for his records. 1040 ez form It will help him (and Kathy, if she survives him) figure the taxable amount of the annuity in later years. 1040 ez form Bill's tax-free monthly amount is $100. 1040 ez form (See line 4 of the worksheet. 1040 ez form ) If he lives to collect more than 310 monthly payments, he will generally have to include in his gross income the full amount of any annuity payments received after 310 payments have been made. 1040 ez form If Bill does not live to collect 310 monthly payments and his wife begins to receive monthly payments, she also will exclude $100 from each monthly payment until 310 payments (Bill's and hers) have been collected. 1040 ez form If she dies before 310 payments have been made, a miscellaneous itemized deduction (not subject to the 2%-of-adjusted- gross-income limit) will be allowed for the unrecovered cost on her final income tax return. 1040 ez form General Rule If your annuity starting date is after November 18, 1996, you cannot use the General Rule to figure the tax-free part of your CSRS or FERS annuity. 1040 ez form If your annuity starting date is after July 1, 1986, but before November 19, 1996, you could have chosen to use either the General Rule or the Simplified Method. 1040 ez form If your annuity starting date is before July 2, 1986, you could have chosen to use the General Rule only if you could not use the Three-Year Rule. 1040 ez form Under the General Rule, you figure the tax-free part of each full monthly payment by multiplying the initial gross monthly rate of your annuity by an exclusion percentage. 1040 ez form Figuring this percentage is complex and requires the use of actuarial tables. 1040 ez form For these tables and other information about using the General Rule, see Publication 939. 1040 ez form Three-Year Rule If your annuity starting date was before July 2, 1986, you probably had to report your annuity using the Three-Year Rule. 1040 ez form Under this rule, you excluded all the annuity payments from income until you fully recovered your cost. 1040 ez form After your cost was recovered, all payments became fully taxable. 1040 ez form You cannot use another rule to again exclude amounts from income. 1040 ez form The Three-Year Rule was repealed for retirees whose annuity starting date is after July 1, 1986. 1040 ez form Worksheet A. 1040 ez form Simplified Method for Bill Smith See the instructions in Part II of this publication under Simplified Method. 1040 ez form 1. 1040 ez form Enter the total pension or annuity payments received this year. 1040 ez form Also, add this amount to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a 1. 1040 ez form $ 8,000 2. 1040 ez form Enter your cost in the plan at the annuity starting date, plus any death benefit exclusion*. 1040 ez form See Your cost in Part II, Rules for Retirees, earlier 2. 1040 ez form 31,000 Note: If your annuity starting date was before this year and you completed this worksheet last year, skip line 3 and enter the amount from line 4 of last year's worksheet on line 4 below (even if the amount of your pension or annuity has changed). 1040 ez form Otherwise, go to line 3. 1040 ez form   3. 1040 ez form Enter the appropriate number from Table 1 below. 1040 ez form But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, enter the appropriate number from Table 2 below. 1040 ez form 3. 1040 ez form 310 4. 1040 ez form Divide line 2 by the number on line 3 4. 1040 ez form 100 5. 1040 ez form Multiply line 4 by the number of months for which this year's payments were made. 1040 ez form If your annuity starting date was before 1987, enter this amount on line 8 below and skip lines 6, 7, 10, and 11. 1040 ez form Otherwise, go to line 6 5. 1040 ez form 800 6. 1040 ez form Enter any amounts previously recovered tax free in years after 1986. 1040 ez form This is the amount shown on line 10 of your worksheet for last year 6. 1040 ez form 0 7. 1040 ez form Subtract line 6 from line 2 7. 1040 ez form 31,000 8. 1040 ez form Enter the smaller of line 5 or line 7 8. 1040 ez form 800 9. 1040 ez form Taxable amount for year. 1040 ez form Subtract line 8 from line 1. 1040 ez form Enter the result, but not less than zero. 1040 ez form Also, add this amount to the total for Form 1040, line 16b, or Form 1040A, line 12b. 1040 ez form If you are a nonresident alien, also enter this amount on line 1 of Worksheet C. 1040 ez form If your Form CSA 1099R or Form CSF 1099R shows a larger amount, use the amount figured on this line instead. 1040 ez form If you are a retired public safety officer, see Distributions Used To Pay Insurance Premiums for Public Safety Officers in Part II before entering an amount on your tax return or Worksheet C, line 1 9. 1040 ez form $7,200 10. 1040 ez form Was your annuity starting date before 1987?   Yes. 1040 ez form Do not complete the rest of this worksheet. 1040 ez form    No. 1040 ez form Add lines 6 and 8. 1040 ez form This is the amount you have recovered tax free through 2013. 1040 ez form You will need this number if you need to fill out this worksheet next year 10. 1040 ez form 800 11. 1040 ez form Balance of cost to be recovered. 1040 ez form Subtract line 10 from line 2. 1040 ez form If zero, you will not have to complete this worksheet next year. 1040 ez form The payments you receive next year will generally be fully taxable 11. 1040 ez form $30,200 Table 1 for Line 3 Above    IF your age on your  annuity starting date was   AND your annuity starting date was—     before November 19, 1996,  THEN enter on line 3 after November 18, 1996,  THEN enter on line 3   55 or under 300 360   56–60 260 310   61–65 240 260   66–70 170 210   71 or over 120 160  Table 2 for Line 3 Above    IF the annuitants' combined ages on your annuity starting date were   THEN enter on line 3         110 or under   410         111–120   360         121–130   310         131–140   260         141 or over   210       * A death benefit exclusion of up to $5,000 applied to certain benefits received by survivors of employees who died before August 21, 1996. 1040 ez form Alternative Annuity Option If you are eligible, you may choose an alternative form of annuity. 1040 ez form If you make this choice, you will receive a lump-sum payment equal to your contributions to the plan and a reduced monthly annuity. 1040 ez form You are eligible to make this choice if you meet all of the following requirements. 1040 ez form You are retiring, but not on disability. 1040 ez form You have a life-threatening illness or other critical medical condition. 1040 ez form You do not have a former spouse entitled to court ordered benefits based on your service. 1040 ez form If you are not eligible or do not choose this alternative annuity, you can skip the following discussion and go to Federal Gift Tax , later. 1040 ez form Lump-Sum Payment The lump-sum payment you receive under the alternative annuity option generally has a tax-free part and a taxable part. 1040 ez form The tax-free part represents part of your cost. 1040 ez form The taxable part represents part of the earnings on your annuity contract. 1040 ez form Your lump-sum credit (discussed later) may include a deemed deposit or redeposit that is treated as being included in your lump-sum payment even though you do not actually receive such amounts. 1040 ez form Deemed deposits and redeposits, which are described later under Lump-sum credit , are taxable to you in the year of retirement. 1040 ez form Your taxable amount may therefore be more than the lump-sum payment you receive. 1040 ez form You must include the taxable part of the lump-sum payment in your income for the year you receive the payment unless you roll it over into another qualified plan or an IRA. 1040 ez form If you do not have OPM transfer the taxable amount to an IRA or other plan in a direct rollover, tax will be withheld at a 20% rate. 1040 ez form See Rollover Rules , later, for information on how to make a rollover. 1040 ez form OPM can make a direct rollover only up to the amount of the lump-sum payment. 1040 ez form Therefore, to defer tax on the full taxable amount if it is more than the payment, you must add funds from another source. 1040 ez form The taxable part of the lump-sum payment does not qualify as a lump-sum distribution eligible for capital gain treatment or the 10-year tax option. 1040 ez form It also may be subject to an additional 10% tax on early distributions if you separate from service before the calendar year in which you reach age 55, even if you reach age 55 in the year you receive the lump-sum payment. 1040 ez form For more information, see Lump-Sum Distributions and Tax on Early Distributions in Publication 575. 1040 ez form Worksheet B. 1040 ez form   Use Worksheet B. 1040 ez form Lump-Sum Payment (near the end of this publication), to figure the taxable part of your lump-sum payment. 1040 ez form Be sure to keep the completed worksheet for your records. 1040 ez form   To complete the worksheet, you will need to know the amount of your lump-sum credit and the present value of your annuity contract. 1040 ez form Lump-sum credit. 1040 ez form   Generally, this is the same amount as the lump-sum payment you receive (the total of your contributions to the retirement system). 1040 ez form However, for purposes of the alternative annuity option, your lump-sum credit also may include deemed deposits and redeposits that OPM advanced to your retirement account so that you are given credit for the service they represent. 1040 ez form Deemed deposits (including interest) are for federal employment during which no retirement contributions were taken out of your pay. 1040 ez form Deemed redeposits (including interest) are for any refunds of retirement contributions that you received and did not repay. 1040 ez form You are treated as if you had received a lump-sum payment equal to the amount of your lump-sum credit and then had made a repayment to OPM of the advanced amounts. 1040 ez form Present value of your annuity contract. 1040 ez form   The present value of your annuity contract is figured using actuarial tables provided by the IRS. 1040 ez form If you are receiving a lump-sum payment under the Alternative Annuity Option, you can write to the address below to find out the present value of your annuity contract. 1040 ez form Internal Revenue Service Attn: Actuarial Group 2 TE/GE SE:T:EP:RA:T:A2 NCA-629 1111 Constitution Ave. 1040 ez form , NW Washington, DC 20224-0002 Example. 1040 ez form David Brown retired from the federal government in 2013, one month after his 55th birthday. 1040 ez form He had contributed $31,000 to his retirement plan and chose to receive a lump-sum payment of that amount under the alternative annuity option. 1040 ez form The present value of his annuity contract was $155,000. 1040 ez form The tax-free part and the taxable part of the lump-sum payment are figured using Worksheet B, as shown below. 1040 ez form The taxable part ($24,800) is also his net cost in the plan, which is used to figure the taxable part of his reduced annuity payments. 1040 ez form See Reduced Annuity , later. 1040 ez form Worksheet B. 1040 ez form Lump-Sum Payment for David Brown See the instructions in Part II of this publication under Alternative Annuity Option . 1040 ez form  1. 1040 ez form Enter your lump-sum credit (your cost in the plan at the annuity starting date) 1. 1040 ez form $ 31,000 2. 1040 ez form Enter the present value of your annuity contract 2. 1040 ez form 155,000 3. 1040 ez form Divide line 1 by line 2 3. 1040 ez form . 1040 ez form 20 4. 1040 ez form Tax-free amount. 1040 ez form Multiply line 1 by line 3. 1040 ez form (Caution: Do not include this amount on line 6 of Worksheet A in this publication. 1040 ez form ) 4. 1040 ez form $6,200 5. 1040 ez form Taxable amount (net cost in the plan). 1040 ez form Subtract line 4 from line 1. 1040 ez form Include this amount in the total on Form 1040, line 16b; Form 1040A, line 12b; or Form 1040NR, line 17b. 1040 ez form Also, enter this amount on line 2 of Worksheet A in this publication. 1040 ez form 5. 1040 ez form $24,800   Lump-sum payment in installments. 1040 ez form   If you choose the alternative annuity option, you usually will receive the lump-sum payment in two equal installments. 1040 ez form You will receive the first installment after you make the choice upon retirement. 1040 ez form The second installment will be paid to you, with interest, in the next calendar year. 1040 ez form (Exceptions to the installment rule are provided for cases of critical medical need. 1040 ez form )   Even though the lump-sum payment is made in installments, the overall tax treatment (explained at the beginning of this discussion) is the same as if the whole payment were paid at once. 1040 ez form If the payment has a tax-free part, you must treat the taxable part as received first. 1040 ez form How to report. 1040 ez form   Add any actual or deemed payment of your lump-sum credit (defined earlier) to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a. 1040 ez form Add the taxable part to the total for Form 1040, line 16b; Form 1040A, line 12b; or Form 1040NR, line 17b, unless you roll over the taxable part to your traditional IRA or a qualified retirement plan. 1040 ez form    If you receive the lump-sum payment in two installments, include any interest paid with the second installment on line 8a of either Form 1040 or Form 1040A, or on line 9a of Form 1040NR. 1040 ez form Reduced Annuity If you have chosen to receive a lump-sum payment under the alternative annuity option, you also will receive reduced monthly annuity payments. 1040 ez form These annuity payments each will have a tax-free and a taxable part. 1040 ez form To figure the tax-free part of each annuity payment, you must use the Simplified Method (Worksheet A). 1040 ez form For instructions on how to complete the worksheet, see Worksheet A under Simplified Method, earlier. 1040 ez form To complete Worksheet A, line 2, you must reduce your cost in the plan by the tax-free part of the lump-sum payment you received. 1040 ez form Enter as your net cost on line 2 the amount from Worksheet B, line 5. 1040 ez form Do not include the tax-free part of the lump-sum payment with other amounts recovered tax free (Worksheet A, line 6) when limiting your total exclusion to your total cost. 1040 ez form Example. 1040 ez form The facts are the same as in the example for David Brown in the preceding discussion. 1040 ez form In addition, David received 10 annuity payments in 2013 of $1,200 each. 1040 ez form Using Worksheet A, he figures the taxable part of his annuity payments. 1040 ez form He completes line 2 by reducing his $31,000 cost by the $6,200 tax-free part of his lump-sum payment. 1040 ez form His entry on line 2 is his $24,800 net cost in the plan (the amount from Worksheet B, line 5). 1040 ez form He does not include the tax-free part of his lump-sum payment on Worksheet A, line 6. 1040 ez form David's filled-in Worksheet A is shown on the next page. 1040 ez form Worksheet A. 1040 ez form Simplified Method for David Brown See the instructions in Part II of this publication under Simplified Method . 1040 ez form 1. 1040 ez form Enter the total pension or annuity payments received this year. 1040 ez form Also, add this amount to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a 1. 1040 ez form $ 12,000 2. 1040 ez form Enter your cost in the plan at the annuity starting date, plus any death benefit exclusion*. 1040 ez form See Your cost in Part II, Rules for Retirees, earlier 2. 1040 ez form 24,800 Note: If your annuity starting date was before this year and you completed this worksheet last year, skip line 3 and enter the amount from line 4 of last year's worksheet on line 4 below (even if the amount of your pension or annuity has changed). 1040 ez form Otherwise, go to line 3. 1040 ez form   3. 1040 ez form Enter the appropriate number from Table 1 below. 1040 ez form But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, enter the appropriate number from Table 2 below. 1040 ez form 3. 1040 ez form 360 4. 1040 ez form Divide line 2 by the number on line 3 4. 1040 ez form 68. 1040 ez form 89 5. 1040 ez form Multiply line 4 by the number of months for which this year's payments were made. 1040 ez form If your annuity starting date was before 1987, enter this amount on line 8 below and skip lines 6, 7, 10, and 11. 1040 ez form Otherwise, go to line 6 5. 1040 ez form 688. 1040 ez form 90 6. 1040 ez form Enter any amounts previously recovered tax free in years after 1986. 1040 ez form This is the amount shown on line 10 of your worksheet for last year 6. 1040 ez form 0 7. 1040 ez form Subtract line 6 from line 2 7. 1040 ez form 24,800 8. 1040 ez form Enter the smaller of line 5 or line 7 8. 1040 ez form 688. 1040 ez form 90 9. 1040 ez form Taxable amount for year. 1040 ez form Subtract line 8 from line 1. 1040 ez form Enter the result, but not less than zero. 1040 ez form Also, add this amount to the total for Form 1040, line 16b, or Form 1040A, line 12b. 1040 ez form If you are a nonresident alien, also enter this amount on line 1 of Worksheet C. 1040 ez form If your Form CSA 1099R or Form CSF 1099R shows a larger amount, use the amount figured on this line instead. 1040 ez form If you are a retired public safety officer, see Distributions Used To Pay Insurance Premiums for Public Safety Officers in Part II before entering an amount on your tax return or Worksheet C, line 1 9. 1040 ez form $11,311. 1040 ez form 10 10. 1040 ez form Was your annuity starting date before 1987?   Yes. 1040 ez form Do not complete the rest of this worksheet. 1040 ez form    No. 1040 ez form Add lines 6 and 8. 1040 ez form This is the amount you have recovered tax free through 2013. 1040 ez form You will need this number if you need to fill out this worksheet next year 10. 1040 ez form 688. 1040 ez form 90 11. 1040 ez form Balance of cost to be recovered. 1040 ez form Subtract line 10 from line 2. 1040 ez form If zero, you will not have to complete this worksheet next year. 1040 ez form The payments you receive next year will generally be fully taxable 11. 1040 ez form $24,111. 1040 ez form 10 Table 1 for Line 3 Above    IF your age on your annuity starting date was   AND your annuity starting date was—     before November 19, 1996,  THEN enter on line 3 after November 18, 1996,  THEN enter on line 3   55 or under 300 360   56–60 260 310   61–65 240 260   66–70 170 210   71 or over 120 160  Table 2 for Line 3 Above    IF the annuitants' combined ages on your annuity starting date were   THEN enter on line 3         110 or under   410         111–120   360         121–130   310         131–140   260         141 or over   210       * A death benefit exclusion of up to $5,000 applied to certain benefits received by survivors of employees who died before August 21, 1996. 1040 ez form Reemployment after choosing the alternative annuity option. 1040 ez form If you chose this option when you retired and then you were reemployed by the Federal Government before retiring again, your Form CSA 1099R may show only the amount of your contributions to your retirement plan during your reemployment. 1040 ez form If the amount on the form does not include all your contributions, disregard it and use your total contributions to figure the taxable part of your annuity payments. 1040 ez form Annuity starting date before November 19, 1996. 1040 ez form   If your annuity starting date is before November 19, 1996, and you chose the alternative annuity option, the taxable and tax-free parts of your lump-sum payment and your annuity payments are figured using different rules. 1040 ez form Under those rules, you do not reduce your cost in the plan (Worksheet A, line 2) by the tax-free part of the lump-sum payment. 1040 ez form However, you must include that tax-free amount with other amounts previously recovered tax free (Worksheet A, line 6) when limiting your total exclusion to your total cost. 1040 ez form Federal Gift Tax If, through the exercise or nonexercise of an election or option, you provide an annuity for your beneficiary at or after your death, you have made a gift. 1040 ez form The gift may be taxable for gift tax purposes. 1040 ez form The value of the gift is equal to the value of the annuity. 1040 ez form Joint and survivor annuity. 1040 ez form   If the gift is an interest in a joint and survivor annuity where only you and your spouse can receive payments before the death of the last spouse to die, the gift generally will qualify for the unlimited marital deduction. 1040 ez form This will eliminate any gift tax liability with regard to that gift. 1040 ez form   If you provide survivor annuity benefits for someone other than your current spouse, such as your former spouse, the unlimited marital deduction will not apply. 1040 ez form This may result in a taxable gift. 1040 ez form More information. 1040 ez form   For information about the gift tax, see Publication 950, Introduction to Estate and Gift Taxes, and Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, and its instructions. 1040 ez form Retirement During the Past Year If you have recently retired, the following discussions covering annual leave, voluntary contributions, and community property may apply to you. 1040 ez form Annual leave. 1040 ez form   A payment for accrued annual leave received on retirement is a salary payment. 1040 ez form It is taxable as wages in the tax year you receive it. 1040 ez form Voluntary contributions. 1040 ez form   Voluntary contributions to the retirement fund are those made in addition to the regular contributions that were deducted from your salary. 1040 ez form They also include the regular contributions withheld from your salary after you have the years of service necessary for the maximum annuity allowed by law. 1040 ez form Voluntary contributions are not the same as employee contributions to the Thrift Savings Plan. 1040 ez form See Thrift Savings Plan , later. 1040 ez form Additional annuity benefit. 1040 ez form   If you choose to receive an additional annuity benefit from your voluntary contributions, it is treated separately from the annuity benefit that comes from the regular contributions deducted from your salary. 1040 ez form This separate treatment applies for figuring the amounts to be excluded from, and included in, gross income. 1040 ez form It does not matter that you receive only one monthly check covering both benefits. 1040 ez form Each year you will receive a Form CSA 1099R that will show how much of your total annuity received in the past year was from each type of benefit. 1040 ez form   Figure the taxable and tax-free parts of your additional monthly benefits from voluntary contributions using the rules that apply to regular CSRS and FERS annuities, as explained earlier. 1040 ez form Refund of voluntary contributions. 1040 ez form   If you choose to receive a refund of your voluntary contributions plus accrued interest, the interest is taxable to you in the tax year it is distributed unless you roll it over to a traditional IRA or another qualified retirement plan. 1040 ez form If you do not have OPM transfer the interest to a traditional IRA or other qualified retirement plan in a direct rollover, tax will be withheld at a 20% rate. 1040 ez form See Rollover Rules , later. 1040 ez form The interest does not qualify as a lump-sum distribution eligible for capital gain treatment or the 10-year tax option. 1040 ez form It also may be subject to an additional 10% tax on early distributions if you separate from service before the calendar year in which you reach age 55. 1040 ez form For more information, see Lump-Sum Distributions and Tax on Early Distributions in Publication 575. 1040 ez form Community property laws. 1040 ez form   State community property laws apply to your annuity. 1040 ez form These laws will affect your income tax only if you file a return separately from your spouse. 1040 ez form   Generally, the determination of whether your annuity is separate income (taxable to you) or community income (taxable to both you and your spouse) is based on your marital status and domicile when you were working. 1040 ez form Regardless of whether you are now living in a community property state or a noncommunity property state, your current annuity may be community income if it is based on services you performed while married and domiciled in a community property state. 1040 ez form   At any time, you have only one domicile even though you may have more than one home. 1040 ez form Your domicile is your fixed and permanent legal home that you intend to use for an indefinite or unlimited period, and to which, when absent, you intend to return. 1040 ez form The question of your domicile is mainly a matter of your intentions as indicated by your actions. 1040 ez form   If your annuity is a mixture of community income and separate income, you must divide it between the two kinds of income. 1040 ez form The division is based on your periods of service and domicile in community and noncommunity property states while you were married. 1040 ez form   For more information, see Publication 555, Community Property. 1040 ez form Reemployment After Retirement If you retired from federal service and are later rehired by the Federal Government as an employee, you can continue to receive your annuity during reemployment. 1040 ez form The employing agency usually will pay you the difference between your salary for your period of reemployment and your annuity. 1040 ez form This amount is taxable as wages. 1040 ez form Your annuity will continue to be taxed just as it was before. 1040 ez form If you are still recovering your cost, you continue to do so. 1040 ez form If you have recovered your cost, the annuity you receive while you are reemployed generally is fully taxable. 1040 ez form Nonresident Aliens The following special rules apply to nonresident alien federal employees performing services outside the United States and to nonresident alien retirees and beneficiaries. 1040 ez form A nonresident alien is an individual who is not a citizen or a resident alien of the United States. 1040 ez form Special rule for figuring your total contributions. 1040 ez form   Your contributions to the retirement plan (your cost) also include the government's contributions to the plan to a certain extent. 1040 ez form You include government contributions that would not have been taxable to you at the time they were contributed if they had been paid directly to you. 1040 ez form For example, government contributions would not have been taxable to you if, at the time made, your services were performed outside the United States. 1040 ez form Thus, your cost is increased by these government contributions and the benefits that you, or your beneficiary, must include in income are reduced. 1040 ez form   This method of figuring your total contributions does not apply to any contributions the government made on your behalf after you became a citizen or a resident alien of the United States. 1040 ez form Limit on taxable amount. 1040 ez form   There is a limit on the taxable amount of payments received from the CSRS, the FERS, or the TSP by a nonresident alien retiree or nonresident alien beneficiary. 1040 ez form Figure this limited taxable amount by multiplying the otherwise taxable amount by a fraction. 1040 ez form The numerator of the fraction is the retiree's total U. 1040 ez form S. 1040 ez form Government basic pay, other than tax-exempt pay for services performed outside the United States. 1040 ez form The denominator is the retiree's total U. 1040 ez form S. 1040 ez form Government basic pay for all services. 1040 ez form    Basic pay includes regular pay plus any standby differential. 1040 ez form It does not include bonuses, overtime pay, certain retroactive pay, uniform or other allowances, or lump-sum leave payments. 1040 ez form   To figure the limited taxable amount of your CSRS or FERS annuity or your TSP distributions, use Worksheet C. 1040 ez form (For an annuity, first complete Worksheet A in this publication. 1040 ez form ) Worksheet C. 1040 ez form Limited Taxable Amount for Nonresident Alien 1. 1040 ez form Enter the otherwise taxable amount of the CSRS or FERS annuity (from line 9 of Worksheet A or from Forms CSA 1099R or CSF 1099R) or TSP distributions (from Form 1099R) 1. 1040 ez form   2. 1040 ez form Enter the total U. 1040 ez form S. 1040 ez form Government basic pay other than tax-exempt pay for services performed outside the United States 2. 1040 ez form   3. 1040 ez form Enter the total U. 1040 ez form S. 1040 ez form Government basic pay for all services 3. 1040 ez form   4. 1040 ez form Divide line 2 by line 3 4. 1040 ez form   5. 1040 ez form Limited taxable amount. 1040 ez form Multiply line 1 by line 4. 1040 ez form Enter this amount on Form 1040NR, line 17b 5. 1040 ez form   Example 1. 1040 ez form You are a nonresident alien who performed all services for the U. 1040 ez form S. 1040 ez form Government abroad as a nonresident alien. 1040 ez form You retired and began to receive a monthly annuity of $200. 1040 ez form Your total basic pay for all services for the U. 1040 ez form S. 1040 ez form Government was $100,000. 1040 ez form All of your basic pay was tax exempt because it was not U. 1040 ez form S. 1040 ez form source income. 1040 ez form The taxable amount of your annuity using Worksheet A in this publication is $720. 1040 ez form You are a nonresident alien, so you figure the limited taxable amount of your annuity using Worksheet C as follows. 1040 ez form Worksheet C. 1040 ez form Limited Taxable Amount for Nonresident Alien — Example 1 1. 1040 ez form Enter the otherwise taxable amount of the CSRS or FERS annuity (from line 9 of Worksheet A or from Forms CSA 1099R or CSF 1099R) or TSP distributions (from Form 1099R) 1. 1040 ez form $ 720 2. 1040 ez form Enter the total U. 1040 ez form S. 1040 ez form Government basic pay other than tax-exempt pay for services performed outside the United States 2. 1040 ez form 0 3. 1040 ez form Enter the total U. 1040 ez form S. 1040 ez form Government basic pay for all services 3. 1040 ez form 100,000 4. 1040 ez form Divide line 2 by line 3 4. 1040 ez form 0 5. 1040 ez form Limited taxable amount. 1040 ez form Multiply line 1 by line 4. 1040 ez form Enter this amount on Form 1040NR, line 17b 5. 1040 ez form 0 Example 2. 1040 ez form You are a nonresident alien who performed services for the U. 1040 ez form S. 1040 ez form Government as a nonresident alien both within the United States and abroad. 1040 ez form You retired and began to receive a monthly annuity of $240. 1040 ez form Your total basic pay for your services for the U. 1040 ez form S. 1040 ez form Government was $120,000; $40,000 was for work done in the United States and $80,000 was for your work done in a foreign country. 1040 ez form The part of your total basic pay for your work done in a foreign country was tax exempt because it was not U. 1040 ez form S. 1040 ez form source income. 1040 ez form The taxable amount of your annuity figured using Worksheet A in this publication is $1,980. 1040 ez form You are a nonresident alien, so you figure the limited taxable amount of your annuity using Worksheet C as follows. 1040 ez form Worksheet C. 1040 ez form Limited Taxable Amount for Nonresident Alien — Example 2 1. 1040 ez form Enter the otherwise taxable amount of the CSRS or FERS annuity (from line 9 of Worksheet A or from Forms CSA 1099R or CSF 1099R) or TSP distributions (from Form 1099R) 1. 1040 ez form $ 1,980 2. 1040 ez form Enter the total U. 1040 ez form S. 1040 ez form Government basic pay other than tax-exempt pay for services performed outside the United States 2. 1040 ez form 40,000 3. 1040 ez form Enter the total U. 1040 ez form S. 1040 ez form Government basic pay for all services 3. 1040 ez form 120,000 4. 1040 ez form Divide line 2 by line 3 4. 1040 ez form . 1040 ez form 333 5. 1040 ez form Limited taxable amount. 1040 ez form Multiply line 1 by line 4. 1040 ez form Enter this amount on Form 1040NR, line 17b 5. 1040 ez form 659 Thrift Savings Plan Generally, all of the money in your TSP account is taxed as ordinary income when you receive it. 1040 ez form (However, see Roth TSP balance and Uniformed services TSP accounts, next. 1040 ez form ) This is because neither the contributions to your traditional TSP balance nor its earnings have been included previously in your taxable income. 1040 ez form The way that you withdraw your account balance determines when you must pay the tax. 1040 ez form Roth TSP balance. 1040 ez form   The TSP also offers a Roth TSP option, which allows you to make after-tax contributions into your TSP account. 1040 ez form This means Roth TSP contributions are included in your income. 1040 ez form The contribution limits are the same as the traditional TSP. 1040 ez form You can elect to have part or all of your TSP contributions designated as a Roth TSP. 1040 ez form Agency contributions will be part of your traditional TSP balance. 1040 ez form Also, you cannot roll over any portion of your traditional TSP into your Roth TSP. 1040 ez form   Qualified distributions from your Roth TSP are not included in income. 1040 ez form This applies to both your cost in the account and income earned on that account. 1040 ez form A qualified distribution is generally a distribution that is: Made after a 5-tax-year period of participation, and Made on or after the date you reach age 59½, made to a beneficiary or your estate on or after your death, or attributable to your being disabled. 1040 ez form   For more information, go to the TSP website, www. 1040 ez form tsp. 1040 ez form gov, or the TSP Service Office. 1040 ez form See Publication 575, Pension and Annuity Income, for more information about designated Roth accounts. 1040 ez form Uniformed services TSP accounts. 1040 ez form   If you have a uniformed services TSP account that includes contributions from combat zone pay, the distributions attributable to those contributions are tax exempt. 1040 ez form However, any earnings on those contributions to a traditional TSP balance are subject to tax when they are distributed. 1040 ez form See Roth TSP balance discussed previously to get more information about Roth contributions. 1040 ez form The statement you receive from the TSP will separately state the total amount of your distribution and the amount of your taxable distribution for the year. 1040 ez form You can get more information from the TSP website, www. 1040 ez form tsp. 1040 ez form gov, or the TSP Service Office. 1040 ez form Direct rollover by the TSP. 1040 ez form   If you ask the TSP to transfer any part of the money in your account, from traditional contributions and its earnings, to a traditional IRA or other qualified retirement plan, the tax on that part is deferred until you receive payments from the traditional IRA or other plan. 1040 ez form However, see the following Note for a discussion on direct rollovers by the TSP of Roth contributions and its earnings. 1040 ez form Also, see Rollover Rules , later. 1040 ez form Direct rollover by the TSP to a Roth IRA. 1040 ez form   If you ask the TSP to transfer any part of the money in your account, from traditional contributions and its earnings, to a Roth IRA, the amount transferred will be taxed in the current year. 1040 ez form However, see the following Note for a discussion on direct rollovers by the TSP of Roth contributions and its earnings. 1040 ez form Also, see Rollovers to Roth IRAs for more information, later. 1040 ez form Note. 1040 ez form A direct rollover of your Roth contributions and its earnings (if certain conditions are met, see Roth TSP balance , earlier) in your TSP account to a Roth 401(k), Roth 403(b), Roth 457(b), or Roth IRA are not subject to tax when they are transferred or when you receive payments from those accounts at a later date. 1040 ez form This is because you already paid tax on those contributions. 1040 ez form You cannot rollover Roth contributions and its earnings in your TSP account to a traditional IRA. 1040 ez form TSP annuity. 1040 ez form   If you ask the TSP to buy an annuity with the money in your account, from traditional contributions and its earnings, the annuity payments are taxed when you receive them. 1040 ez form The payments are not subject to the additional 10% tax on early distributions, even if you are under age 55 when they begin. 1040 ez form However, there is no tax on the annuity payments if the annuity is purchased using the money in your account from Roth contributions and its earnings if certain conditions are met. 1040 ez form See Roth TSP balance , earlier. 1040 ez form This is because you already paid tax on those contributions. 1040 ez form Cash withdrawals. 1040 ez form   If you withdraw any of the money in your TSP account, from traditional contributions and its earnings, it is generally taxed as ordinary income when you receive it unless you roll it over into a traditional IRA or other qualified plan. 1040 ez form (See Rollover Rules , later. 1040 ez form ) If you receive your entire TSP account balance in a single tax year, you may be able to use the 10-year tax option to figure your tax. 1040 ez form See Lump-Sum Distributions in Publication 575 for details. 1040 ez form However, there is no tax if you withdraw money in your TSP account from Roth contributions and its earnings if certain conditions are met. 1040 ez form See Roth TSP balance , earlier. 1040 ez form    To qualify for the 10-year tax option, the plan participant must have been born before January 2, 1936. 1040 ez form   If you receive a single payment or you choose to receive your account balance in monthly payments over a period of less than 10 years, the TSP generally must withhold 20% for federal income tax. 1040 ez form If you choose to receive your account balance in monthly payments over a period of 10 or more years or a period based on your life expectancy, the payments are subject to withholding as if you are married with three withholding allowances, unless you submit a withholding certificate. 1040 ez form See also Withholding from Thrift Savings Plan payments earlier under Tax Withholding and Estimated Tax in Part I. 1040 ez form However, there is no withholding requirement for amounts withdrawn from your TSP account that is from Roth contributions and its earnings, if certain conditions are met. 1040 ez form See Roth TSP balance , earlier, for a discussion of those conditions. 1040 ez form Tax on early distributions. 1040 ez form   Any money paid to you from your TSP account before you reach age 59½ may be subject to an additional 10% tax on early distributions. 1040 ez form However, this additional tax does not apply in certain situations, including any of the following. 1040 ez form You receive the distribution and separate from government service during or after the calendar year in which you reach age 55. 1040 ez form You choose to receive your account balance in monthly payments based on your life expectancy. 1040 ez form You are totally and permanently disabled. 1040 ez form You receive amounts from your Roth contributions since that represents a return of your cost (after-tax money). 1040 ez form The earnings may be subject to the 10% tax depending on whether you met certain conditions. 1040 ez form See Roth TSP balance , earlier. 1040 ez form   For more information, see Tax on Early Distributions in Publication 575. 1040 ez form Outstanding loan. 1040 ez form   If the TSP declares a distribution from your account because money you borrowed has not been repaid when you separate from government service, your account is reduced and the amount of the distribution (your unpaid loan balance and any unpaid interest), from traditional contributions and its earnings, is taxed in the year declared. 1040 ez form The distribution also may be subject to the additional 10% tax on early distributions. 1040 ez form However, the tax will be deferred if you make a rollover contribution to a traditional IRA or other qualified plan equal to the declared distribution amount. 1040 ez form See Rollover Rules , later. 1040 ez form   If you withdraw any money from your TSP account in that same year, the TSP must withhold income tax of 20% of the total of the declared distribution and the amount withdrawn. 1040 ez form However, no withholding is required for portions of the distribution that is from Roth contributions and its earnings, if certain conditions are met. 1040 ez form See Roth TSP balance , earlier. 1040 ez form More information. 1040 ez form   For more information about the TSP, see Summary of the Thrift Savings Plan, distributed to all federal employees. 1040 ez form Also, see Important Tax Information About Payments From Your TSP Account and Special Tax Withholding Rules for Thrift Savings Plan Payments to Nonresident Aliens, which are available from your agency personnel office or from the TSP by calling 1-TSP-YOU-FIRST (1-877-968-3778) and for participants who are deaf, hard of hearing, or have a speech disability, call 1-TSP-THRIFT5 (1-877-847-4385). 1040 ez form    The above documents are also available on the TSP website at www. 1040 ez form tsp. 1040 ez form gov. 1040 ez form Select “Forms & Publications. 1040 ez form ” Rollover Rules Generally, a rollover is a tax-free withdrawal of cash or other assets from one qualified retirement plan or traditional IRA and its reinvestment in another qualified retirement plan or traditional IRA. 1040 ez form You do not include the amount rolled over in your income, and you cannot take a deduction for it. 1040 ez form The amount rolled over is taxed later as the new program pays that amount to you. 1040 ez form If you roll over amounts into a traditional IRA, later distributions of these amounts from the traditional IRA do not qualify for the capital gain or the 10-year tax option. 1040 ez form However, capital gain treatment or the 10-year tax option will be restored if the traditional IRA contains only amounts rolled over from a qualified plan and these amounts are rolled over from the traditional IRA into a qualified retirement plan. 1040 ez form To qualify for the capital gain treatment or 10-year tax option, the plan participant must have been born before January 2, 1936. 1040 ez form You can also roll over a distribution from a qualified retirement plan into a Roth IRA. 1040 ez form Although the transfer of a distribution into a Roth IRA is considered a rollover for Roth IRA purposes, it is not a tax-free transfer unless you are rolling over amounts from Roth contributions and its earnings. 1040 ez form See Rollovers to Roth IRAs , later, for more information. 1040 ez form Qualified retirement plan. 1040 ez form   For this purpose, a qualified retirement plan generally is: A qualified employee plan, A qualified employee annuity, A tax-sheltered annuity plan (403(b) plan), or An eligible state or local government section 457 deferred compensation plan. 1040 ez form The CSRS, FERS, and TSP are considered qualified retirement plans. 1040 ez form Distributions eligible for rollover treatment. 1040 ez form   If you receive a refund of your CSRS or FERS contributions when you leave government service, you can roll over any interest you receive on the contributions. 1040 ez form You cannot roll over any part of your CSRS or FERS annuity payments. 1040 ez form   You can roll over a distribution of any part of your TSP account balance except: A distribution of your account balance that you choose to receive in monthly payments over: Your life expectancy, The joint life expectancies of you and your beneficiary, or A period of 10 years or more, A required minimum distribution generally beginning at age 70½, A declared distribution because of an unrepaid loan, if you have not separated from government service (see Outstanding loan under Thrift Savings Plan, earlier), or A hardship distribution. 1040 ez form   In addition, a distribution to your beneficiary generally is not treated as an eligible rollover distribution. 1040 ez form However, see Qualified domestic relations order (QDRO) and Rollovers by surviving spouse , and Rollovers by nonspouse beneficiary , later. 1040 ez form Direct rollover option. 1040 ez form   You can choose to have the OPM or TSP transfer any part of an eligible rollover distribution directly to another qualified retirement plan that accepts rollover distributions or to a traditional IRA or Roth IRA. 1040 ez form   There is an automatic rollover requirement for mandatory distributions. 1040 ez form A mandatory distribution is a distribution made without your consent and before you reach age 62 or normal retirement age, whichever is later. 1040 ez form The automatic rollover requirement applies if the distribution is more than $1,000 and is an eligible rollover distribution. 1040 ez form You can choose to have the distribution paid directly to you or rolled over directly to your traditional or Roth IRA or another qualified retirement plan. 1040 ez form If you do not make this choice, OPM will automatically roll over the distribution into an IRA of a designated trustee or issuer. 1040 ez form No tax withheld. 1040 ez form   If you choose the direct rollover option or have an automatic rollover, no tax will be withheld from any part of the distribution that is directly paid to the trustee of the other plan. 1040 ez form However, if the rollover is to a Roth IRA, you may want to choose to have tax withheld since any amount rolled over is generally included in income. 1040 ez form Any part of the eligible rollover distribution paid to you is subject to withholding at a 20% rate. 1040 ez form Direct roll over amounts from Roth contributions and its earnings do not have tax withheld because you already paid tax on those amounts. 1040 ez form Payment to you option. 1040 ez form   If an eligible rollover distribution is paid to you, the OPM or TSP must withhold 20% for income tax even if you plan to roll over the distribution to another qualified retirement plan, traditional or Roth IRA. 1040 ez form However, the full amount is treated as distributed to you even though you actually receive only 80%. 1040 ez form You generally must include in income any part (including the part withheld) that you do not roll over within 60 days to another qualified retirement plan or to a traditional IRA. 1040 ez form Rollovers to Roth IRAs are generally included in income. 1040 ez form Eligible rollover distributions that are from Roth contributions do not have tax withheld because you already paid tax on those amounts. 1040 ez form If you leave government service before the calendar year in which you reach age 55 and are under age 59½ when a distribution is paid to you, you may have to pay an additional 10% tax on any part, including any tax withheld, that you do not roll over. 1040 ez form However, distributions from Roth contributions will not be subject to the 10% additional tax because it is a return of your cost (after-tax money). 1040 ez form Earnings from those contributions may be subject to the 10% additional tax if certain conditions are not met. 1040 ez form See Roth TSP balance , earlier. 1040 ez form Also, see Tax on Early Distributions in Publication 575. 1040 ez form Exception to withholding. 1040 ez form   Withholding from an eligible rollover distribution paid to you is not required if the distributions for your tax year total less than $200. 1040 ez form Partial rollovers. 1040 ez form   A lump-sum distribution may qualify for capital gain treatment or the 10-year tax option if the plan participant was born before January 2, 1936. 1040 ez form See Lump-Sum Distributions in Publication 575. 1040 ez form However, if you roll over any part of the distribution, the part you keep does not qualify for this special tax treatment. 1040 ez form Rolling over more than amount received. 1040 ez form   If you want to roll over more of an eligible rollover distribution than the amount you received after income tax was withheld, you will have to add funds from some other source (such as your savings or borrowed amounts). 1040 ez form Example. 1040 ez form You left government service at age 53. 1040 ez form On February 1, 2013, you receive an eligible rollover distribution of $10,000 from you