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Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Gross monthly rate. Irs free tax filing online irs e-file Your cost. Irs free tax filing online irs e-file Choosing a survivor annuity after retirement. Irs free tax filing online irs e-file Canceling a survivor annuity after retirement. Irs free tax filing online irs e-file Annuity starting date after 1986. Irs free tax filing online irs e-file Annuity starting date before 1987. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file The refund will include both regular and voluntary contributions you made to the fund, plus any interest payable. Irs free tax filing online irs e-file If the refund includes only your contributions, none of the refund is taxable. Irs free tax filing online irs e-file 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). Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file See Rollover Rules in Part II for information on how to make a rollover. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Therefore, many employees who withdraw their contributions under the CSRS do not get interest and do not owe any tax on their refund. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file For more information, see Lump-Sum Distributions and Tax on Early Distributions in Publication 575. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file OPM will tell you how to make the choice. Irs free tax filing online irs e-file The choice for no withholding remains in effect until you change it. Irs free tax filing online irs e-file These withholding rules also apply to a disability annuity, whether received before or after minimum retirement age. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file For more information, including exceptions to the penalty, see chapter 4 of Publication 505, Tax Withholding and Estimated Tax. Irs free tax filing online irs e-file Form CSA 1099R. Irs free tax filing online irs e-file   Form CSA 1099R is mailed to you by OPM each year. Irs free tax filing online irs e-file It will show any tax you had withheld. Irs free tax filing online irs e-file File a copy of Form CSA 1099R with your tax return if any federal income tax was withheld. Irs free tax filing online irs e-file    You also can view and download your Form CSA 1099R by visiting the OPM website at  www. Irs free tax filing online irs e-file servicesonline. Irs free tax filing online irs e-file opm. Irs free tax filing online irs e-file gov. Irs free tax filing online irs e-file To log in, you will need your retirement CSA claim number and your personal identification number. Irs free tax filing online irs e-file Choosing no withholding on payments outside the United States. Irs free tax filing online irs e-file   The choice for no withholding generally cannot be made for annuity payments to be delivered outside the United States and its possessions. Irs free tax filing online irs e-file   To choose no withholding if you are a U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file citizen or resident alien, you must provide OPM with your home address in the United States or its possessions. Irs free tax filing online irs e-file Otherwise, OPM has to withhold tax. Irs free tax filing online irs e-file For example, OPM must withhold if you provide a U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file home address. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file citizen, a U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file resident alien, or someone who left the United States to avoid tax. Irs free tax filing online irs e-file But if you so certify, you may be subject to the 30% flat rate withholding that applies to nonresident aliens. Irs free tax filing online irs e-file For details, see Publication 519, U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Tax Guide for Aliens. Irs free tax filing online irs e-file Withholding certificate. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file The amount of tax withheld depends on your marital status, the number of withholding allowances, and any additional amount you designate to be withheld. Irs free tax filing online irs e-file If you do not make either of these choices, OPM must withhold as if you were married with three withholding allowances. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file C. Irs free tax filing online irs e-file calling area must call 202-606-0500). Irs free tax filing online irs e-file No special form is needed. Irs free tax filing online irs e-file You will need your retirement CSA or CSF claim number, your social security number, and your personal identification number (PIN) when you call. Irs free tax filing online irs e-file If you have TTY/TDD equipment, call 1-855–887–4957. Irs free tax filing online irs e-file If you need a PIN, call OPM's Retirement Information Office. Irs free tax filing online irs e-file You also can change the amount of withholding or stop withholding online by visiting the OPM website at www. Irs free tax filing online irs e-file servicesonline. Irs free tax filing online irs e-file opm. Irs free tax filing online irs e-file gov. Irs free tax filing online irs e-file You will need your retirement CSA or CSF claim number and your PIN. Irs free tax filing online irs e-file Withholding from certain lump-sum payments. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file Tax will be withheld at a 20% rate on the interest distributed. Irs free tax filing online irs e-file However, tax will not be withheld if you have OPM transfer (roll over) the interest directly to your traditional IRA or other qualified plan. Irs free tax filing online irs e-file If you have OPM transfer (roll over) the interest directly to a Roth IRA, the entire amount will be taxed in the current year. Irs free tax filing online irs e-file Because no income tax will be withheld at the time of the transfer, you may want to increase your withholding or pay estimated taxes. Irs free tax filing online irs e-file See Rollover Rules in Part II. Irs free tax filing online irs e-file If you receive only your contributions, no tax will be withheld. Irs free tax filing online irs e-file Withholding from Thrift Savings Plan payments. Irs free tax filing online irs e-file   Generally, a distribution that you receive from the TSP is subject to federal income tax withholding. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file  However, you usually can choose not to have tax withheld from TSP payments other than eligible rollover distributions. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file The above document is also available in the “Forms & Publications” section of the TSP website at www. Irs free tax filing online irs e-file tsp. Irs free tax filing online irs e-file gov. Irs free tax filing online irs e-file Estimated tax. Irs free tax filing online irs e-file   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)). Irs free tax filing online irs e-file The return must cover all 12 months. Irs free tax filing online irs e-file   You do not have to pay estimated tax for 2014 if you were a U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file citizen or resident alien for all of 2013 and you had no tax liability for the full 12-month 2013 tax year. Irs free tax filing online irs e-file   Publication 505 contains information that you can use to help you figure your estimated tax payments. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file The gross income filing requirements for the tax year are in the instructions to Form 1040, 1040A, or 1040EZ. Irs free tax filing online irs e-file Children. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file Form CSF 1099R. Irs free tax filing online irs e-file   Form CSF 1099R will be mailed to you by January 31 after the end of each tax year. Irs free tax filing online irs e-file It will show the total amount of the annuity you received in the past year. Irs free tax filing online irs e-file It also should show, separately, the survivor annuity for a child or children. Irs free tax filing online irs e-file Only the part that is each individual's survivor annuity should be shown on that individual's Form 1040 or 1040A. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file    You also can view and download your Form CSF 1099R by visiting the OPM website at  www. Irs free tax filing online irs e-file servicesonline. Irs free tax filing online irs e-file opm. Irs free tax filing online irs e-file gov. Irs free tax filing online irs e-file To log in you will need your retirement CSF claim number and personal identification number. Irs free tax filing online irs e-file    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. Irs free tax filing online irs e-file C. Irs free tax filing online irs e-file calling area must call 202-606-0500). Irs free tax filing online irs e-file You will need your CSF claim number and your social security number when you call. Irs free tax filing online irs e-file Taxable part of annuity. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Part II Rules for Retirees This part of the publication is for retirees who retired on nondisability retirement. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Annuity statement. Irs free tax filing online irs e-file   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). Irs free tax filing online irs e-file You will use this information to figure the tax-free recovery of your cost. Irs free tax filing online irs e-file Annuity starting date. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Gross monthly rate. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file Your cost. Irs free tax filing online irs e-file   Your monthly annuity payment contains an amount on which you have previously paid income tax. Irs free tax filing online irs e-file This amount represents part of your contributions to the retirement plan. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file   The cost of your annuity is the total of your contributions to the retirement plan, as shown on your annuity statement from OPM. Irs free tax filing online irs e-file If you elected the alternative annuity option, it includes any deemed deposits and any deemed redeposits that were added to your lump-sum credit. Irs free tax filing online irs e-file (See Lump-sum credit under Alternative Annuity Option, later. Irs free tax filing online irs e-file )   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. Irs free tax filing online irs e-file You cannot claim an interest deduction for any interest payments. Irs free tax filing online irs e-file You cannot treat these payments as voluntary contributions; they are considered regular employee contributions. Irs free tax filing online irs e-file Recovering your cost tax free. Irs free tax filing online irs e-file   How you figure the tax-free recovery of the cost of your CSRS or FERS annuity depends on your annuity starting date. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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). Irs free tax filing online irs e-file If your annuity starting date is after November 18, 1996, you must use the Simplified Method. Irs free tax filing online irs e-file   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). Irs free tax filing online irs e-file The tax-free part is a fixed dollar amount. Irs free tax filing online irs e-file It remains the same, even if your annuity is increased. Irs free tax filing online irs e-file Generally, this rule applies as long as you receive your annuity. Irs free tax filing online irs e-file However, see Exclusion limit , later. Irs free tax filing online irs e-file Choosing a survivor annuity after retirement. Irs free tax filing online irs e-file    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. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file To figure the new exclusion percentage, reduce your cost by the amount you previously recovered tax free. Irs free tax filing online irs e-file Figure the expected return as of the date the reduced annuity begins. Irs free tax filing online irs e-file For details on the General Rule, see Publication 939. Irs free tax filing online irs e-file Canceling a survivor annuity after retirement. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file The increased annuity does not change the cost recovery you figured at the annuity starting date. Irs free tax filing online irs e-file The tax-free part of each annuity payment remains the same. Irs free tax filing online irs e-file    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. Irs free tax filing online irs e-file C. Irs free tax filing online irs e-file calling area must call 202-606-0500). Irs free tax filing online irs e-file Exclusion limit. Irs free tax filing online irs e-file   Your annuity starting date determines the total amount of annuity payments that you can exclude from income over the years. Irs free tax filing online irs e-file Annuity starting date after 1986. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file Annuity payments you or your survivors receive after the total cost in the plan has been recovered are generally fully taxable. Irs free tax filing online irs e-file Example. Irs free tax filing online irs e-file Your annuity starting date is after 1986 and you exclude $100 a month under the Simplified Method. Irs free tax filing online irs e-file If your cost is $12,000, the exclusion ends after 10 years (120 months). Irs free tax filing online irs e-file Thereafter, your entire annuity is generally fully taxable. Irs free tax filing online irs e-file Annuity starting date before 1987. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file If you chose a joint and survivor annuity, your survivor can continue to take that same exclusion. Irs free tax filing online irs e-file The total exclusion may be more than your cost. Irs free tax filing online irs e-file Deduction of unrecovered cost. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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). Irs free tax filing online irs e-file If your annuity starting date is before July 2, 1986, no tax benefit is allowed for any unrecovered cost at death. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file (OPM has figured the taxable amount of your annuity shown on your Form CSA 1099R using the Simplified Method. Irs free tax filing online irs e-file ) 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. Irs free tax filing online irs e-file The Simplified Method does not apply if your annuity starting date is before July 2, 1986. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file This number will differ depending on whether your annuity starting date is before November 19, 1996, or after November 18, 1996. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Worksheet A. Irs free tax filing online irs e-file   Use Worksheet A. Irs free tax filing online irs e-file Simplified Method (near the end of this publication), to figure your taxable annuity. Irs free tax filing online irs e-file Be sure to keep the completed worksheet. Irs free tax filing online irs e-file It will help you figure your taxable amounts for later years. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file However, you must use Worksheet A and Worksheet B in this publication if you chose the alternative annuity option, discussed later. Irs free tax filing online irs e-file Line 2. Irs free tax filing online irs e-file   See Your cost , earlier, for an explanation of your cost in the plan. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Line 3. Irs free tax filing online irs e-file   The number you enter on line 3 is the appropriate number from Table 1 or 2 representing approximate life expectancies in months. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file If your annuity starting date is before 1998, use Table 1. Irs free tax filing online irs e-file Line 6. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Example. Irs free tax filing online irs e-file Bill Smith retired from the Federal Government on March 31, 2013, under an annuity that will provide a survivor benefit for his wife, Kathy. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file He must use the Simplified Method to figure the tax-free part of his annuity benefits. Irs free tax filing online irs e-file Bill's monthly annuity benefit is $1,000. Irs free tax filing online irs e-file He had contributed $31,000 to his retirement plan and had received no distributions before his annuity starting date. Irs free tax filing online irs e-file At his annuity starting date, he was 65 and Kathy was 57. Irs free tax filing online irs e-file Bill's completed Worksheet A is shown later. Irs free tax filing online irs e-file 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). Irs free tax filing online irs e-file Bill keeps a copy of the completed worksheet for his records. Irs free tax filing online irs e-file It will help him (and Kathy, if she survives him) figure the taxable amount of the annuity in later years. Irs free tax filing online irs e-file Bill's tax-free monthly amount is $100. Irs free tax filing online irs e-file (See line 4 of the worksheet. Irs free tax filing online irs e-file ) 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Figuring this percentage is complex and requires the use of actuarial tables. Irs free tax filing online irs e-file For these tables and other information about using the General Rule, see Publication 939. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Under this rule, you excluded all the annuity payments from income until you fully recovered your cost. Irs free tax filing online irs e-file After your cost was recovered, all payments became fully taxable. Irs free tax filing online irs e-file You cannot use another rule to again exclude amounts from income. Irs free tax filing online irs e-file The Three-Year Rule was repealed for retirees whose annuity starting date is after July 1, 1986. Irs free tax filing online irs e-file Worksheet A. Irs free tax filing online irs e-file Simplified Method for Bill Smith See the instructions in Part II of this publication under Simplified Method. Irs free tax filing online irs e-file 1. Irs free tax filing online irs e-file Enter the total pension or annuity payments received this year. Irs free tax filing online irs e-file Also, add this amount to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a 1. Irs free tax filing online irs e-file $ 8,000 2. Irs free tax filing online irs e-file Enter your cost in the plan at the annuity starting date, plus any death benefit exclusion*. Irs free tax filing online irs e-file See Your cost in Part II, Rules for Retirees, earlier 2. Irs free tax filing online irs e-file 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). Irs free tax filing online irs e-file Otherwise, go to line 3. Irs free tax filing online irs e-file   3. Irs free tax filing online irs e-file Enter the appropriate number from Table 1 below. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 3. Irs free tax filing online irs e-file 310 4. Irs free tax filing online irs e-file Divide line 2 by the number on line 3 4. Irs free tax filing online irs e-file 100 5. Irs free tax filing online irs e-file Multiply line 4 by the number of months for which this year's payments were made. Irs free tax filing online irs e-file If your annuity starting date was before 1987, enter this amount on line 8 below and skip lines 6, 7, 10, and 11. Irs free tax filing online irs e-file Otherwise, go to line 6 5. Irs free tax filing online irs e-file 800 6. Irs free tax filing online irs e-file Enter any amounts previously recovered tax free in years after 1986. Irs free tax filing online irs e-file This is the amount shown on line 10 of your worksheet for last year 6. Irs free tax filing online irs e-file 0 7. Irs free tax filing online irs e-file Subtract line 6 from line 2 7. Irs free tax filing online irs e-file 31,000 8. Irs free tax filing online irs e-file Enter the smaller of line 5 or line 7 8. Irs free tax filing online irs e-file 800 9. Irs free tax filing online irs e-file Taxable amount for year. Irs free tax filing online irs e-file Subtract line 8 from line 1. Irs free tax filing online irs e-file Enter the result, but not less than zero. Irs free tax filing online irs e-file Also, add this amount to the total for Form 1040, line 16b, or Form 1040A, line 12b. Irs free tax filing online irs e-file If you are a nonresident alien, also enter this amount on line 1 of Worksheet C. Irs free tax filing online irs e-file If your Form CSA 1099R or Form CSF 1099R shows a larger amount, use the amount figured on this line instead. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file $7,200 10. Irs free tax filing online irs e-file Was your annuity starting date before 1987?   Yes. Irs free tax filing online irs e-file Do not complete the rest of this worksheet. Irs free tax filing online irs e-file    No. Irs free tax filing online irs e-file Add lines 6 and 8. Irs free tax filing online irs e-file This is the amount you have recovered tax free through 2013. Irs free tax filing online irs e-file You will need this number if you need to fill out this worksheet next year 10. Irs free tax filing online irs e-file 800 11. Irs free tax filing online irs e-file Balance of cost to be recovered. Irs free tax filing online irs e-file Subtract line 10 from line 2. Irs free tax filing online irs e-file If zero, you will not have to complete this worksheet next year. Irs free tax filing online irs e-file The payments you receive next year will generally be fully taxable 11. Irs free tax filing online irs e-file $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. Irs free tax filing online irs e-file Alternative Annuity Option If you are eligible, you may choose an alternative form of annuity. Irs free tax filing online irs e-file If you make this choice, you will receive a lump-sum payment equal to your contributions to the plan and a reduced monthly annuity. Irs free tax filing online irs e-file You are eligible to make this choice if you meet all of the following requirements. Irs free tax filing online irs e-file You are retiring, but not on disability. Irs free tax filing online irs e-file You have a life-threatening illness or other critical medical condition. Irs free tax filing online irs e-file You do not have a former spouse entitled to court ordered benefits based on your service. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Lump-Sum Payment The lump-sum payment you receive under the alternative annuity option generally has a tax-free part and a taxable part. Irs free tax filing online irs e-file The tax-free part represents part of your cost. Irs free tax filing online irs e-file The taxable part represents part of the earnings on your annuity contract. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Deemed deposits and redeposits, which are described later under Lump-sum credit , are taxable to you in the year of retirement. Irs free tax filing online irs e-file Your taxable amount may therefore be more than the lump-sum payment you receive. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file See Rollover Rules , later, for information on how to make a rollover. Irs free tax filing online irs e-file OPM can make a direct rollover only up to the amount of the lump-sum payment. Irs free tax filing online irs e-file Therefore, to defer tax on the full taxable amount if it is more than the payment, you must add funds from another source. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file For more information, see Lump-Sum Distributions and Tax on Early Distributions in Publication 575. Irs free tax filing online irs e-file Worksheet B. Irs free tax filing online irs e-file   Use Worksheet B. Irs free tax filing online irs e-file Lump-Sum Payment (near the end of this publication), to figure the taxable part of your lump-sum payment. Irs free tax filing online irs e-file Be sure to keep the completed worksheet for your records. Irs free tax filing online irs e-file   To complete the worksheet, you will need to know the amount of your lump-sum credit and the present value of your annuity contract. Irs free tax filing online irs e-file Lump-sum credit. Irs free tax filing online irs e-file   Generally, this is the same amount as the lump-sum payment you receive (the total of your contributions to the retirement system). Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Deemed deposits (including interest) are for federal employment during which no retirement contributions were taken out of your pay. Irs free tax filing online irs e-file Deemed redeposits (including interest) are for any refunds of retirement contributions that you received and did not repay. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Present value of your annuity contract. Irs free tax filing online irs e-file   The present value of your annuity contract is figured using actuarial tables provided by the IRS. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Internal Revenue Service Attn: Actuarial Group 2 TE/GE SE:T:EP:RA:T:A2 NCA-629 1111 Constitution Ave. Irs free tax filing online irs e-file , NW Washington, DC 20224-0002 Example. Irs free tax filing online irs e-file David Brown retired from the federal government in 2013, one month after his 55th birthday. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file The present value of his annuity contract was $155,000. Irs free tax filing online irs e-file The tax-free part and the taxable part of the lump-sum payment are figured using Worksheet B, as shown below. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file See Reduced Annuity , later. Irs free tax filing online irs e-file Worksheet B. Irs free tax filing online irs e-file Lump-Sum Payment for David Brown See the instructions in Part II of this publication under Alternative Annuity Option . Irs free tax filing online irs e-file  1. Irs free tax filing online irs e-file Enter your lump-sum credit (your cost in the plan at the annuity starting date) 1. Irs free tax filing online irs e-file $ 31,000 2. Irs free tax filing online irs e-file Enter the present value of your annuity contract 2. Irs free tax filing online irs e-file 155,000 3. Irs free tax filing online irs e-file Divide line 1 by line 2 3. Irs free tax filing online irs e-file . Irs free tax filing online irs e-file 20 4. Irs free tax filing online irs e-file Tax-free amount. Irs free tax filing online irs e-file Multiply line 1 by line 3. Irs free tax filing online irs e-file (Caution: Do not include this amount on line 6 of Worksheet A in this publication. Irs free tax filing online irs e-file ) 4. Irs free tax filing online irs e-file $6,200 5. Irs free tax filing online irs e-file Taxable amount (net cost in the plan). Irs free tax filing online irs e-file Subtract line 4 from line 1. Irs free tax filing online irs e-file Include this amount in the total on Form 1040, line 16b; Form 1040A, line 12b; or Form 1040NR, line 17b. Irs free tax filing online irs e-file Also, enter this amount on line 2 of Worksheet A in this publication. Irs free tax filing online irs e-file 5. Irs free tax filing online irs e-file $24,800   Lump-sum payment in installments. Irs free tax filing online irs e-file   If you choose the alternative annuity option, you usually will receive the lump-sum payment in two equal installments. Irs free tax filing online irs e-file You will receive the first installment after you make the choice upon retirement. Irs free tax filing online irs e-file The second installment will be paid to you, with interest, in the next calendar year. Irs free tax filing online irs e-file (Exceptions to the installment rule are provided for cases of critical medical need. Irs free tax filing online irs e-file )   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. Irs free tax filing online irs e-file If the payment has a tax-free part, you must treat the taxable part as received first. Irs free tax filing online irs e-file How to report. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file    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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file These annuity payments each will have a tax-free and a taxable part. Irs free tax filing online irs e-file To figure the tax-free part of each annuity payment, you must use the Simplified Method (Worksheet A). Irs free tax filing online irs e-file For instructions on how to complete the worksheet, see Worksheet A under Simplified Method, earlier. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Enter as your net cost on line 2 the amount from Worksheet B, line 5. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Example. Irs free tax filing online irs e-file The facts are the same as in the example for David Brown in the preceding discussion. Irs free tax filing online irs e-file In addition, David received 10 annuity payments in 2013 of $1,200 each. Irs free tax filing online irs e-file Using Worksheet A, he figures the taxable part of his annuity payments. Irs free tax filing online irs e-file He completes line 2 by reducing his $31,000 cost by the $6,200 tax-free part of his lump-sum payment. Irs free tax filing online irs e-file His entry on line 2 is his $24,800 net cost in the plan (the amount from Worksheet B, line 5). Irs free tax filing online irs e-file He does not include the tax-free part of his lump-sum payment on Worksheet A, line 6. Irs free tax filing online irs e-file David's filled-in Worksheet A is shown on the next page. Irs free tax filing online irs e-file Worksheet A. Irs free tax filing online irs e-file Simplified Method for David Brown See the instructions in Part II of this publication under Simplified Method . Irs free tax filing online irs e-file 1. Irs free tax filing online irs e-file Enter the total pension or annuity payments received this year. Irs free tax filing online irs e-file Also, add this amount to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a 1. Irs free tax filing online irs e-file $ 12,000 2. Irs free tax filing online irs e-file Enter your cost in the plan at the annuity starting date, plus any death benefit exclusion*. Irs free tax filing online irs e-file See Your cost in Part II, Rules for Retirees, earlier 2. Irs free tax filing online irs e-file 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). Irs free tax filing online irs e-file Otherwise, go to line 3. Irs free tax filing online irs e-file   3. Irs free tax filing online irs e-file Enter the appropriate number from Table 1 below. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 3. Irs free tax filing online irs e-file 360 4. Irs free tax filing online irs e-file Divide line 2 by the number on line 3 4. Irs free tax filing online irs e-file 68. Irs free tax filing online irs e-file 89 5. Irs free tax filing online irs e-file Multiply line 4 by the number of months for which this year's payments were made. Irs free tax filing online irs e-file If your annuity starting date was before 1987, enter this amount on line 8 below and skip lines 6, 7, 10, and 11. Irs free tax filing online irs e-file Otherwise, go to line 6 5. Irs free tax filing online irs e-file 688. Irs free tax filing online irs e-file 90 6. Irs free tax filing online irs e-file Enter any amounts previously recovered tax free in years after 1986. Irs free tax filing online irs e-file This is the amount shown on line 10 of your worksheet for last year 6. Irs free tax filing online irs e-file 0 7. Irs free tax filing online irs e-file Subtract line 6 from line 2 7. Irs free tax filing online irs e-file 24,800 8. Irs free tax filing online irs e-file Enter the smaller of line 5 or line 7 8. Irs free tax filing online irs e-file 688. Irs free tax filing online irs e-file 90 9. Irs free tax filing online irs e-file Taxable amount for year. Irs free tax filing online irs e-file Subtract line 8 from line 1. Irs free tax filing online irs e-file Enter the result, but not less than zero. Irs free tax filing online irs e-file Also, add this amount to the total for Form 1040, line 16b, or Form 1040A, line 12b. Irs free tax filing online irs e-file If you are a nonresident alien, also enter this amount on line 1 of Worksheet C. Irs free tax filing online irs e-file If your Form CSA 1099R or Form CSF 1099R shows a larger amount, use the amount figured on this line instead. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file $11,311. Irs free tax filing online irs e-file 10 10. Irs free tax filing online irs e-file Was your annuity starting date before 1987?   Yes. Irs free tax filing online irs e-file Do not complete the rest of this worksheet. Irs free tax filing online irs e-file    No. Irs free tax filing online irs e-file Add lines 6 and 8. Irs free tax filing online irs e-file This is the amount you have recovered tax free through 2013. Irs free tax filing online irs e-file You will need this number if you need to fill out this worksheet next year 10. Irs free tax filing online irs e-file 688. Irs free tax filing online irs e-file 90 11. Irs free tax filing online irs e-file Balance of cost to be recovered. Irs free tax filing online irs e-file Subtract line 10 from line 2. Irs free tax filing online irs e-file If zero, you will not have to complete this worksheet next year. Irs free tax filing online irs e-file The payments you receive next year will generally be fully taxable 11. Irs free tax filing online irs e-file $24,111. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Reemployment after choosing the alternative annuity option. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Annuity starting date before November 19, 1996. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file The gift may be taxable for gift tax purposes. Irs free tax filing online irs e-file The value of the gift is equal to the value of the annuity. Irs free tax filing online irs e-file Joint and survivor annuity. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file This will eliminate any gift tax liability with regard to that gift. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file This may result in a taxable gift. Irs free tax filing online irs e-file More information. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Annual leave. Irs free tax filing online irs e-file   A payment for accrued annual leave received on retirement is a salary payment. Irs free tax filing online irs e-file It is taxable as wages in the tax year you receive it. Irs free tax filing online irs e-file Voluntary contributions. Irs free tax filing online irs e-file   Voluntary contributions to the retirement fund are those made in addition to the regular contributions that were deducted from your salary. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Voluntary contributions are not the same as employee contributions to the Thrift Savings Plan. Irs free tax filing online irs e-file See Thrift Savings Plan , later. Irs free tax filing online irs e-file Additional annuity benefit. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file This separate treatment applies for figuring the amounts to be excluded from, and included in, gross income. Irs free tax filing online irs e-file It does not matter that you receive only one monthly check covering both benefits. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file Refund of voluntary contributions. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file See Rollover Rules , later. Irs free tax filing online irs e-file The interest does not qualify as a lump-sum distribution eligible for capital gain treatment or the 10-year tax option. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file For more information, see Lump-Sum Distributions and Tax on Early Distributions in Publication 575. Irs free tax filing online irs e-file Community property laws. Irs free tax filing online irs e-file   State community property laws apply to your annuity. Irs free tax filing online irs e-file These laws will affect your income tax only if you file a return separately from your spouse. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file   At any time, you have only one domicile even though you may have more than one home. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file The question of your domicile is mainly a matter of your intentions as indicated by your actions. Irs free tax filing online irs e-file   If your annuity is a mixture of community income and separate income, you must divide it between the two kinds of income. Irs free tax filing online irs e-file The division is based on your periods of service and domicile in community and noncommunity property states while you were married. Irs free tax filing online irs e-file   For more information, see Publication 555, Community Property. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file The employing agency usually will pay you the difference between your salary for your period of reemployment and your annuity. Irs free tax filing online irs e-file This amount is taxable as wages. Irs free tax filing online irs e-file Your annuity will continue to be taxed just as it was before. Irs free tax filing online irs e-file If you are still recovering your cost, you continue to do so. Irs free tax filing online irs e-file If you have recovered your cost, the annuity you receive while you are reemployed generally is fully taxable. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file A nonresident alien is an individual who is not a citizen or a resident alien of the United States. Irs free tax filing online irs e-file Special rule for figuring your total contributions. Irs free tax filing online irs e-file   Your contributions to the retirement plan (your cost) also include the government's contributions to the plan to a certain extent. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file For example, government contributions would not have been taxable to you if, at the time made, your services were performed outside the United States. Irs free tax filing online irs e-file Thus, your cost is increased by these government contributions and the benefits that you, or your beneficiary, must include in income are reduced. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file Limit on taxable amount. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file Figure this limited taxable amount by multiplying the otherwise taxable amount by a fraction. Irs free tax filing online irs e-file The numerator of the fraction is the retiree's total U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government basic pay, other than tax-exempt pay for services performed outside the United States. Irs free tax filing online irs e-file The denominator is the retiree's total U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government basic pay for all services. Irs free tax filing online irs e-file    Basic pay includes regular pay plus any standby differential. Irs free tax filing online irs e-file It does not include bonuses, overtime pay, certain retroactive pay, uniform or other allowances, or lump-sum leave payments. Irs free tax filing online irs e-file   To figure the limited taxable amount of your CSRS or FERS annuity or your TSP distributions, use Worksheet C. Irs free tax filing online irs e-file (For an annuity, first complete Worksheet A in this publication. Irs free tax filing online irs e-file ) Worksheet C. Irs free tax filing online irs e-file Limited Taxable Amount for Nonresident Alien 1. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file   2. Irs free tax filing online irs e-file Enter the total U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government basic pay other than tax-exempt pay for services performed outside the United States 2. Irs free tax filing online irs e-file   3. Irs free tax filing online irs e-file Enter the total U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government basic pay for all services 3. Irs free tax filing online irs e-file   4. Irs free tax filing online irs e-file Divide line 2 by line 3 4. Irs free tax filing online irs e-file   5. Irs free tax filing online irs e-file Limited taxable amount. Irs free tax filing online irs e-file Multiply line 1 by line 4. Irs free tax filing online irs e-file Enter this amount on Form 1040NR, line 17b 5. Irs free tax filing online irs e-file   Example 1. Irs free tax filing online irs e-file You are a nonresident alien who performed all services for the U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government abroad as a nonresident alien. Irs free tax filing online irs e-file You retired and began to receive a monthly annuity of $200. Irs free tax filing online irs e-file Your total basic pay for all services for the U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government was $100,000. Irs free tax filing online irs e-file All of your basic pay was tax exempt because it was not U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file source income. Irs free tax filing online irs e-file The taxable amount of your annuity using Worksheet A in this publication is $720. Irs free tax filing online irs e-file You are a nonresident alien, so you figure the limited taxable amount of your annuity using Worksheet C as follows. Irs free tax filing online irs e-file Worksheet C. Irs free tax filing online irs e-file Limited Taxable Amount for Nonresident Alien — Example 1 1. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file $ 720 2. Irs free tax filing online irs e-file Enter the total U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government basic pay other than tax-exempt pay for services performed outside the United States 2. Irs free tax filing online irs e-file 0 3. Irs free tax filing online irs e-file Enter the total U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government basic pay for all services 3. Irs free tax filing online irs e-file 100,000 4. Irs free tax filing online irs e-file Divide line 2 by line 3 4. Irs free tax filing online irs e-file 0 5. Irs free tax filing online irs e-file Limited taxable amount. Irs free tax filing online irs e-file Multiply line 1 by line 4. Irs free tax filing online irs e-file Enter this amount on Form 1040NR, line 17b 5. Irs free tax filing online irs e-file 0 Example 2. Irs free tax filing online irs e-file You are a nonresident alien who performed services for the U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government as a nonresident alien both within the United States and abroad. Irs free tax filing online irs e-file You retired and began to receive a monthly annuity of $240. Irs free tax filing online irs e-file Your total basic pay for your services for the U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file The part of your total basic pay for your work done in a foreign country was tax exempt because it was not U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file source income. Irs free tax filing online irs e-file The taxable amount of your annuity figured using Worksheet A in this publication is $1,980. Irs free tax filing online irs e-file You are a nonresident alien, so you figure the limited taxable amount of your annuity using Worksheet C as follows. Irs free tax filing online irs e-file Worksheet C. Irs free tax filing online irs e-file Limited Taxable Amount for Nonresident Alien — Example 2 1. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file $ 1,980 2. Irs free tax filing online irs e-file Enter the total U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government basic pay other than tax-exempt pay for services performed outside the United States 2. Irs free tax filing online irs e-file 40,000 3. Irs free tax filing online irs e-file Enter the total U. Irs free tax filing online irs e-file S. Irs free tax filing online irs e-file Government basic pay for all services 3. Irs free tax filing online irs e-file 120,000 4. Irs free tax filing online irs e-file Divide line 2 by line 3 4. Irs free tax filing online irs e-file . Irs free tax filing online irs e-file 333 5. Irs free tax filing online irs e-file Limited taxable amount. Irs free tax filing online irs e-file Multiply line 1 by line 4. Irs free tax filing online irs e-file Enter this amount on Form 1040NR, line 17b 5. Irs free tax filing online irs e-file 659 Thrift Savings Plan Generally, all of the money in your TSP account is taxed as ordinary income when you receive it. Irs free tax filing online irs e-file (However, see Roth TSP balance and Uniformed services TSP accounts, next. Irs free tax filing online irs e-file ) This is because neither the contributions to your traditional TSP balance nor its earnings have been included previously in your taxable income. Irs free tax filing online irs e-file The way that you withdraw your account balance determines when you must pay the tax. Irs free tax filing online irs e-file Roth TSP balance. Irs free tax filing online irs e-file   The TSP also offers a Roth TSP option, which allows you to make after-tax contributions into your TSP account. Irs free tax filing online irs e-file This means Roth TSP contributions are included in your income. Irs free tax filing online irs e-file The contribution limits are the same as the traditional TSP. Irs free tax filing online irs e-file You can elect to have part or all of your TSP contributions designated as a Roth TSP. Irs free tax filing online irs e-file Agency contributions will be part of your traditional TSP balance. Irs free tax filing online irs e-file Also, you cannot roll over any portion of your traditional TSP into your Roth TSP. Irs free tax filing online irs e-file   Qualified distributions from your Roth TSP are not included in income. Irs free tax filing online irs e-file This applies to both your cost in the account and income earned on that account. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file   For more information, go to the TSP website, www. Irs free tax filing online irs e-file tsp. Irs free tax filing online irs e-file gov, or the TSP Service Office. Irs free tax filing online irs e-file See Publication 575, Pension and Annuity Income, for more information about designated Roth accounts. Irs free tax filing online irs e-file Uniformed services TSP accounts. Irs free tax filing online irs e-file   If you have a uniformed services TSP account that includes contributions from combat zone pay, the distributions attributable to those contributions are tax exempt. Irs free tax filing online irs e-file However, any earnings on those contributions to a traditional TSP balance are subject to tax when they are distributed. Irs free tax filing online irs e-file See Roth TSP balance discussed previously to get more information about Roth contributions. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file You can get more information from the TSP website, www. Irs free tax filing online irs e-file tsp. Irs free tax filing online irs e-file gov, or the TSP Service Office. Irs free tax filing online irs e-file Direct rollover by the TSP. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file However, see the following Note for a discussion on direct rollovers by the TSP of Roth contributions and its earnings. Irs free tax filing online irs e-file Also, see Rollover Rules , later. Irs free tax filing online irs e-file Direct rollover by the TSP to a Roth IRA. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file However, see the following Note for a discussion on direct rollovers by the TSP of Roth contributions and its earnings. Irs free tax filing online irs e-file Also, see Rollovers to Roth IRAs for more information, later. Irs free tax filing online irs e-file Note. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file This is because you already paid tax on those contributions. Irs free tax filing online irs e-file You cannot rollover Roth contributions and its earnings in your TSP account to a traditional IRA. Irs free tax filing online irs e-file TSP annuity. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file The payments are not subject to the additional 10% tax on early distributions, even if you are under age 55 when they begin. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file See Roth TSP balance , earlier. Irs free tax filing online irs e-file This is because you already paid tax on those contributions. Irs free tax filing online irs e-file Cash withdrawals. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file (See Rollover Rules , later. Irs free tax filing online irs e-file ) 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. Irs free tax filing online irs e-file See Lump-Sum Distributions in Publication 575 for details. Irs free tax filing online irs e-file However, there is no tax if you withdraw money in your TSP account from Roth contributions and its earnings if certain conditions are met. Irs free tax filing online irs e-file See Roth TSP balance , earlier. Irs free tax filing online irs e-file    To qualify for the 10-year tax option, the plan participant must have been born before January 2, 1936. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file See also Withholding from Thrift Savings Plan payments earlier under Tax Withholding and Estimated Tax in Part I. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file See Roth TSP balance , earlier, for a discussion of those conditions. Irs free tax filing online irs e-file Tax on early distributions. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file However, this additional tax does not apply in certain situations, including any of the following. Irs free tax filing online irs e-file You receive the distribution and separate from government service during or after the calendar year in which you reach age 55. Irs free tax filing online irs e-file You choose to receive your account balance in monthly payments based on your life expectancy. Irs free tax filing online irs e-file You are totally and permanently disabled. Irs free tax filing online irs e-file You receive amounts from your Roth contributions since that represents a return of your cost (after-tax money). Irs free tax filing online irs e-file The earnings may be subject to the 10% tax depending on whether you met certain conditions. Irs free tax filing online irs e-file See Roth TSP balance , earlier. Irs free tax filing online irs e-file   For more information, see Tax on Early Distributions in Publication 575. Irs free tax filing online irs e-file Outstanding loan. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file The distribution also may be subject to the additional 10% tax on early distributions. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file See Rollover Rules , later. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file However, no withholding is required for portions of the distribution that is from Roth contributions and its earnings, if certain conditions are met. Irs free tax filing online irs e-file See Roth TSP balance , earlier. Irs free tax filing online irs e-file More information. Irs free tax filing online irs e-file   For more information about the TSP, see Summary of the Thrift Savings Plan, distributed to all federal employees. Irs free tax filing online irs e-file 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). Irs free tax filing online irs e-file    The above documents are also available on the TSP website at www. Irs free tax filing online irs e-file tsp. Irs free tax filing online irs e-file gov. Irs free tax filing online irs e-file Select “Forms & Publications. Irs free tax filing online irs e-file ” 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. Irs free tax filing online irs e-file You do not include the amount rolled over in your income, and you cannot take a deduction for it. Irs free tax filing online irs e-file The amount rolled over is taxed later as the new program pays that amount to you. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file To qualify for the capital gain treatment or 10-year tax option, the plan participant must have been born before January 2, 1936. Irs free tax filing online irs e-file You can also roll over a distribution from a qualified retirement plan into a Roth IRA. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file See Rollovers to Roth IRAs , later, for more information. Irs free tax filing online irs e-file Qualified retirement plan. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file The CSRS, FERS, and TSP are considered qualified retirement plans. Irs free tax filing online irs e-file Distributions eligible for rollover treatment. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file You cannot roll over any part of your CSRS or FERS annuity payments. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file   In addition, a distribution to your beneficiary generally is not treated as an eligible rollover distribution. Irs free tax filing online irs e-file However, see Qualified domestic relations order (QDRO) and Rollovers by surviving spouse , and Rollovers by nonspouse beneficiary , later. Irs free tax filing online irs e-file Direct rollover option. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file   There is an automatic rollover requirement for mandatory distributions. Irs free tax filing online irs e-file A mandatory distribution is a distribution made without your consent and before you reach age 62 or normal retirement age, whichever is later. Irs free tax filing online irs e-file The automatic rollover requirement applies if the distribution is more than $1,000 and is an eligible rollover distribution. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file If you do not make this choice, OPM will automatically roll over the distribution into an IRA of a designated trustee or issuer. Irs free tax filing online irs e-file No tax withheld. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Any part of the eligible rollover distribution paid to you is subject to withholding at a 20% rate. Irs free tax filing online irs e-file Direct roll over amounts from Roth contributions and its earnings do not have tax withheld because you already paid tax on those amounts. Irs free tax filing online irs e-file Payment to you option. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file However, the full amount is treated as distributed to you even though you actually receive only 80%. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file Rollovers to Roth IRAs are generally included in income. Irs free tax filing online irs e-file Eligible rollover distributions that are from Roth contributions do not have tax withheld because you already paid tax on those amounts. Irs free tax filing online irs e-file 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. Irs free tax filing online irs e-file 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). Irs free tax filing online irs e-file Earnings from those contributions may be subject to the 10% additional tax if certain conditions are not met. Irs free tax filing online irs e-file See Roth TSP balance , earlier. Irs free tax filing online irs e-file Also, see Tax on Early Distributions in Publication 575. Irs free tax filing online irs e-file Exception to withholding. Irs free tax filing online irs e-file   Withholding from an eligible rollover distribution paid to you is not required if the distributions for your tax year total less than $200. Irs free tax filing online irs e-file Partial rollovers. Irs free tax filing online irs e-file   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. Irs free tax filing online irs e-file See Lump-Sum Distributions in Publication 575. Irs free tax filing online irs e-file However, if you roll over any part of the distribution, the part you keep does not qualify for this special tax treatment. Irs free tax filing online irs e-file Rolling over more than amount received. Irs free tax filing online irs e-file   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). Irs free tax filing online irs e-file Example. Irs free tax filing online irs e-file You left government service at age 53. Irs free tax filing online irs e-file On February 1, 2013, you receive an eligible rollover distribution of $10,000 from you
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Understanding Your CP142 Notice

We sent you this notice because you filed your information returns late.


What you need to do

  • You must get an extension of time to file so we can finish processing your returns. To request an extension, send us a letter with the information described in the notice along with a copy of the late return and the notice.
  • You must respond within 30 days from the date of the notice.

Answers to Common Questions

Where should I mail my response?
Mail your statement to the address at the top of the notice.

Can I fax the information?
Yes. You can fax your response to (801) 620-5555. Follow the instructions for the cover sheet as explained on your notice. Please don’t fax and mail your response.

Page Last Reviewed or Updated: 26-Mar-2014

Printable samples of this notice (PDF)

 

 

How to get help

  • Call the 1-800 number listed on the top right corner of your notice.
  • Authorize someone (e.g., accountant) to contact the IRS on your behalf using Form 2848.
  • See if you qualify for help from a Low Income Taxpayer Clinic.
     

The Irs Free Tax Filing Online Irs E-file

Irs free tax filing online irs e-file Index A Adjusted basis defined, Adjusted basis defined. Irs free tax filing online irs e-file Administrative or management activities, Administrative or management activities. Irs free tax filing online irs e-file Assistance (see Tax help) Attorneys, Place To Meet Patients, Clients, or Customers B Business expenses not for use of home, Business expenses not for use of your home. Irs free tax filing online irs e-file Business furniture and equipment, Business Furniture and Equipment Business percentage, Business Percentage Business use of the home requirements (see Qualifying for a deduction) C Carryover of expenses, Carryover of unallowed expenses. Irs free tax filing online irs e-file Casualty losses, Casualty losses. Irs free tax filing online irs e-file Child and Adult Care Food Program reimbursements, Meals. Irs free tax filing online irs e-file Computer Listed property, Listed Property D Daycare facilities, Daycare Facility, Standard meal and snack rates. Irs free tax filing online irs e-file (see also Family daycare providers) Eligible children for standard meal and snack rates, Standard meal and snack rates. Irs free tax filing online irs e-file Exceptions for regular use requirement, Daycare Facility Family daycare, Standard meal and snack rates. Irs free tax filing online irs e-file Family daycare provider, Standard meal and snack rates. Irs free tax filing online irs e-file Meals, Meals. Irs free tax filing online irs e-file , Standard meal and snack rates. Irs free tax filing online irs e-file Regular use, Daycare Facility Standard meal and snack rates, Meals. Irs free tax filing online irs e-file , Standard meal and snack rates. Irs free tax filing online irs e-file Deduction limit, Deduction Limit Deduction requirements Employee use, Additional tests for employee use. Irs free tax filing online irs e-file Exceptions to exclusive use, Exceptions to Exclusive Use Exclusive use, Exclusive Use More than one trade or business, More Than One Trade or Business Place to meet clients, Place To Meet Patients, Clients, or Customers Principal place of business, Principal Place of Business Regular use, Regular Use Separate structure, Separate Structure Storage of inventory or product samples, Storage of inventory or product samples. Irs free tax filing online irs e-file Trade or business use, Trade or Business Use Deductions Figuring, Figuring the Deduction, Part 2—Figure Your Allowable Deduction Limit, Deduction Limit Part-year use, Part-year use. Irs free tax filing online irs e-file Qualifying for, Qualifying for a Deduction, Separate Structure Rental to employer, Rental to employer. Irs free tax filing online irs e-file Unreimbursed partnership expenses, Deducting unreimbursed partnership expenses. Irs free tax filing online irs e-file Using Actual Expenses, Using Actual Expenses Dentists, Place To Meet Patients, Clients, or Customers Depreciation, Property Bought for Business Use 5-year property, Depreciation 7-year property, Depreciation Adjusted basis, Adjusted basis defined. Irs free tax filing online irs e-file Fair market value, Fair market value defined. Irs free tax filing online irs e-file Figuring depreciation for the current year, Figuring the depreciation deduction for the current year. Irs free tax filing online irs e-file Furniture and equipment, Business Furniture and Equipment, Depreciation Home, Depreciating Your Home Nonresidential real property, Figuring the depreciation deduction for the current year. Irs free tax filing online irs e-file Percentage table for 39-year nonresidential real property, Depreciation table. Irs free tax filing online irs e-file Permanent improvements, Permanent improvements. Irs free tax filing online irs e-file , Depreciating permanent improvements. Irs free tax filing online irs e-file Depreciation of home, Depreciating Your Home Basis adjustment, Basis Adjustment MACRS (Table 2), Depreciation table. Irs free tax filing online irs e-file Property bought for business use, Depreciation Sale or exchange of home, Depreciation Doctors, Place To Meet Patients, Clients, or Customers E Employee use of home, Additional tests for employee use. Irs free tax filing online irs e-file Employees Adequately accounting to employer, Adequately accounting to employer. Irs free tax filing online irs e-file Casualty losses, Casualty losses. Irs free tax filing online irs e-file Mortgage interest, Deductible mortgage interest. Irs free tax filing online irs e-file Other expenses, Other expenses. Irs free tax filing online irs e-file Real estate taxes, Real estate taxes. Irs free tax filing online irs e-file Exclusive use, Exclusive Use Expenses Casualty losses, Casualty losses. Irs free tax filing online irs e-file Direct, Actual Expenses Indirect, Actual Expenses Insurance, Insurance. Irs free tax filing online irs e-file Mortgage interest, Deductible mortgage interest. Irs free tax filing online irs e-file , Qualified mortgage insurance premiums. Irs free tax filing online irs e-file Real estate taxes, Real estate taxes. Irs free tax filing online irs e-file Related to tax-exempt income, Expenses related to tax-exempt income. Irs free tax filing online irs e-file Rent, Rent. Irs free tax filing online irs e-file Repairs, Repairs. Irs free tax filing online irs e-file Security system, Security system. Irs free tax filing online irs e-file Telephone, Telephone. Irs free tax filing online irs e-file Types of, Actual Expenses Unrelated, Actual Expenses Utilities and services, Utilities and services. Irs free tax filing online irs e-file Where to deduct, Where To Deduct F Fair market value, Fair market value defined. Irs free tax filing online irs e-file Family daycare providers Meal and snack log (Exhibit A), Standard meal and snack rates. Irs free tax filing online irs e-file Standard meal and snack rates, Standard meal and snack rates. Irs free tax filing online irs e-file Standard meal and snack rates (Table 3), Standard meal and snack rates. Irs free tax filing online irs e-file Figuring the deduction Business percentage, Business Percentage Deduction limit, Deduction Limit Form, Useful Items - You may want to see:, Self-Employed Persons, Real estate taxes. Irs free tax filing online irs e-file 1040, Schedule F, Casualty losses. Irs free tax filing online irs e-file 2106, Employees 4562, Reporting and recordkeeping requirements. Irs free tax filing online irs e-file 4684, Casualty losses. Irs free tax filing online irs e-file 8829, Actual Expenses, Casualty losses. Irs free tax filing online irs e-file , Business Percentage, Daycare Facility W-2 Reimbursed expenses, Employees Free tax services, Free help with your tax return. Irs free tax filing online irs e-file Furniture and equipment, Business Furniture and Equipment H Help (see Tax help) Home Business percentage, Business Percentage Depreciation, Depreciating Your Home Sale of, Sale or Exchange of Your Home Home expenses, Can you deduct business use of, Figure A, , Principal Place of Business I Improvements (see Permanent improvements) Insurance, Insurance. Irs free tax filing online irs e-file Inventory, storage of, Storage of inventory or product samples. Irs free tax filing online irs e-file L Listed property Computers, Listed Property Defined, Listed Property Employee requirements, Employee. Irs free tax filing online irs e-file Reporting and recordkeeping requirements, Reporting and recordkeeping requirements. Irs free tax filing online irs e-file Years following the year placed in service, Years following the year placed in service. Irs free tax filing online irs e-file M MACRS percentage table 39-year nonresidential real property, Depreciation table. Irs free tax filing online irs e-file Meals, Meals. Irs free tax filing online irs e-file Meeting with patients, clients, or customers on premises, Place To Meet Patients, Clients, or Customers More than one place of business, More than one place of business. Irs free tax filing online irs e-file More than one trade or business, More Than One Trade or Business More-than-50%-use test, More-than-50%-use test. Irs free tax filing online irs e-file Mortgage interest, Deductible mortgage interest. Irs free tax filing online irs e-file , Qualified mortgage insurance premiums. Irs free tax filing online irs e-file P Partners, Partners Partnership expenses, unreimbursed, Deducting unreimbursed partnership expenses. Irs free tax filing online irs e-file Permanent improvements, Permanent improvements. Irs free tax filing online irs e-file , Depreciating permanent improvements. Irs free tax filing online irs e-file Personal property converted to business use, Personal Property Converted to Business Use Place of business, more than one, More than one place of business. Irs free tax filing online irs e-file Principal place of business, Principal Place of Business Product samples, Storage of inventory or product samples. Irs free tax filing online irs e-file Property bought for business use Depreciation, Depreciation Section 179 deduction, Property Bought for Business Use, Section 179 Deduction Property converted to business use, Personal, Personal Property Converted to Business Use Publications, Useful Items - You may want to see: (see Tax help) Q Qualifying for a deduction, Qualifying for a Deduction R Real estate taxes, Real estate taxes. Irs free tax filing online irs e-file Recordkeeping, Recordkeeping Recordkeeping requirements Business furniture and equipment, Reporting and recordkeeping requirements. Irs free tax filing online irs e-file Family daycare provider meal and snack log (Exhibit A), Standard meal and snack rates. Irs free tax filing online irs e-file Regular use, Regular Use Reminders, Reminders Rent, Rent. Irs free tax filing online irs e-file Repairs, Repairs. Irs free tax filing online irs e-file Reporting requirements Business furniture and equipment, Reporting and recordkeeping requirements. Irs free tax filing online irs e-file S Sale or exchange of your home, Sale or Exchange of Your Home Basis adjustment, Basis Adjustment Depreciation taken, Depreciation Ownership and use tests, Ownership and use tests. Irs free tax filing online irs e-file Section 179, Section 179 Deduction Furniture and equipment, Business Furniture and Equipment, Listed Property Listed property, Business Furniture and Equipment, Listed Property Personal property converted to business use, Personal Property Converted to Business Use Property bought for business use, Property Bought for Business Use Security system, Security system. Irs free tax filing online irs e-file Self-employed persons Deduction of expenses, Self-Employed Persons Separate structure, Separate Structure Simplified Method Actual expenses and depreciation of your home, Actual expenses and depreciation of your home. Irs free tax filing online irs e-file Allowable area, Allowable area. Irs free tax filing online irs e-file Business expenses not related to use of the home, Business expenses not related to use of the home. Irs free tax filing online irs e-file Electing the simplified method, Electing the Simplified Method More than one home, More than one home. Irs free tax filing online irs e-file More than one qualified business use, More than one qualified business use. Irs free tax filing online irs e-file Shared use, Shared use. Irs free tax filing online irs e-file Expenses deductible without regard to business use, Expenses deductible without regard to business use. Irs free tax filing online irs e-file No carryover of unallowed expenses, No deduction of carryover of actual expenses. Irs free tax filing online irs e-file Simplified amount, Simplified Amount Space used regularly for daycare, Space used regularly for daycare. Irs free tax filing online irs e-file Using the simplified method, Using the Simplified Method Standard meal and snack rates, Standard meal and snack rates. Irs free tax filing online irs e-file Storage of inventory, Storage of inventory or product samples. Irs free tax filing online irs e-file T Tables and figures MACRS Depreciation of home (Table 2), Depreciation table. Irs free tax filing online irs e-file Qualifying for deduction (Figure A), Standard meal and snack rates (Table 3), Table 3. Irs free tax filing online irs e-file Standard Meal and Snack Rates1 Types of expenses (Table 1), Actual Expenses Tax help, How To Get Tax Help Telephone, Telephone. Irs free tax filing online irs e-file Trade or business use, Trade or Business Use TTY/TDD information, How To Get Tax Help Types of expenses, Actual Expenses U Utilities, Utilities and services. Irs free tax filing online irs e-file W Where to deduct expenses, Where To Deduct Employees, Employees Self-employed, Self-Employed Persons Worksheets Area Adjustment Worksheet (for simplified method), Area Adjustment Worksheet (for simplified method) Worksheets to figure the deduction for business use of your home (simplified method), Worksheets To Figure the Deduction for Business Use of Your Home (Simplified Method) Daycare facility worksheet (for simplified method), Daycare Facility Worksheet (for simplified method) Simplified method worksheet, Simplified Method Worksheet Prev  Up     Home   More Online Publications