Line 16a and
Line 16b – Pensions and annuities
You should receive a Form 1099-R showing the total amount of your
pension and annuity payments before income tax or other deductions were
withheld. This amount should be shown in box 1 of Form 1099-R. Pension and
annuity payments include distributions from 401(k), 403(b), and governmental
457(b) plans. Rollovers and lump-sum distributions are explained later.
Do not include the following payments on lines 16a and 16b.
Instead, report them on line 7.
·
Disability pensions received before you reach
the minimum retirement age set by your employer.
·
Corrective distributions (including any
earnings) of excess salary deferrals or excess contributions to retirement
plans. The plan must advise you of the year(s) the distributions are includible
in income.
Attach Form(s) 1099-R to Form 1040 if any federal income tax was
withheld. If you rolled over part or all of a qualified retirement plan (other
than a designated Roth account) to a Roth IRA in 2010 (or you rolled over part
or all of a 401(k) or 403(b) plan to a designated Roth account in 2010) and did
not elect to report the taxable amount on your 2010 return, you generally must
report half of it on your 2011 return and the rest on your 2012 return. See
2010 Roth IRA rollovers, or 2010 in-plan rollovers, whichever applies, later.
Fully Taxable Pensions and
Annuities
Your payments are fully taxable if (a) you did not contribute to
the cost (see Cost, later) of your pension or annuity, or (b) you got your
entire cost back tax free before 2011. But see Insurance Premiums for Retired
Public Safety Officers, later. If your pension or annuity is fully taxable,
enter the total pension or annuity payments (from
Form(s) 1099-R, box 1) on line 16b; do not make an entry on line
16a. Fully taxable pensions and annuities also include military retirement pay
shown on Form 1099-R. For details on military disability pensions, see Pub.
525. If you received a Form RRB-1099-R, see Pub. 575 to find out how to report your benefits.
Partially Taxable Pensions and
Annuities
Enter the total pension or annuity payments (from Form 1099-R, box
1) on line 16a. If your Form 1099-R does not show the taxable amount, you must
use the General Rule explained in Pub. 939 to figure the taxable part to enter
on line 16b. But if your annuity starting date (defined later) was after July
1, 1986, see Simplified Method, later, to find out if you must use that method
to figure the taxable part. You can ask the IRS to figure the taxable part for
you for a $1,000 fee. For details, see Pub. 939. If your Form 1099-R shows a
taxable amount, you can report that amount on line 16b. But you may be able to
report a lower taxable amount by using the General Rule or the Simplified
Method or if the exclusion for retired public safety officers, discussed next,
applies.
Insurance Premiums for Retired
Public Safety Officers
If you are an eligible retired public safety officer (law
enforcement officer, firefighter, chaplain, or member of a rescue squad or
ambulance crew), you can elect to exclude from income distributions made from
your eligible retirement plan that are used to pay the premiums for coverage by
an accident or health plan or a long-term care insurance contract. You can do
this only if you retired because of disability or because you reached normal
retirement age. The premiums can be for coverage for you, your spouse, or
dependents. The distribution must be from a plan maintained by the employer
from which you retired as a public safety officer. Also, the distribution must
be made directly from the plan to the provider of the accident or health plan or
long-term care insurance contract. You can exclude from income the smaller of
the amount of the premiums or $3,000. You can only make this election for
amounts that would otherwise be included in your income.
An eligible retirement plan is a governmental plan that is:
·
A qualified trust,
·
A section 403(a) plan,
·
A section 403(b) plan, or
·
A section 457(b) plan.
If you make this election, reduce the otherwise taxable amount of
your pension or annuity by the amount excluded. The amount shown in box 2a of
Form 1099-R does not reflect the exclusion. Report your total distributions on
line 16a and the tax- able amount on line 16b. Enter “PSO” next to line 16b.
If you are retired on disability and reporting your disability
pension on line 7, include only the taxable amount on that line and enter “PSO”
and the amount excluded on the dotted line next to line 7.
Simplified Method
You must use the Simplified Method if either of the following
applies.
·
Your annuity starting date was after July 1,
1986, and you used this method last year to figure the taxable part.
·
Your annuity starting date was after November
18, 1996, and both of the following apply.
o The
payments are from a qualified employee plan, a qualified employee annuity, or a
tax-sheltered annuity.
o On your
annuity starting date, either you were under age 75 or the number of years of
guaranteed payments was fewer than five. See Pub. 575 for the definition of guaranteed
payments. If you must use the Simplified Method, complete the Simplified Method
Worksheet in these instructions to figure the taxable part of your pension or
annuity. For more details on the Simplified Method, see Pub. 575 or Pub. 721
for U.S. Civil Service retirement benefits.
If you received U.S. Civil Service retirement benefits and you chose
the alternative annuity option, see Pub. 721 to figure the taxable part of your
annuity. Do not use the Simplified Method Worksheet in these instructions.
Annuity Starting Date
Your annuity starting date is the later of the first day of the
first period for which you received a payment or the date the plan’s obligations
became fixed.
Age (or Combined Ages) at
Annuity Starting Date
If you are the retiree, use your age on the annuity starting date.
If you are the survivor of a retiree, use the retiree’s age on his or her
annuity starting date. But if your annuity starting date was after 1997 and the
payments are for your life and that of your beneficiary, use your combined ages
on the annuity starting date.
If you are the beneficiary of an employee who died, see Pub. 575.
If there is more than one beneficiary, see Pub. 575 or Pub. 721 to figure each
beneficiary’s tax-able amount.
Cost
Your cost is generally your net investment in the plan as of the
annuity starting date. It does not include pre-tax contributions. Your net
investment should be shown in box 9b of Form 1099-R for the first year you
received payments from the plan.
Rollovers
Generally, a qualified rollover is a tax-free distribution of cash
or other assets from one retirement plan that is contributed to another plan
within 60 days of receiving the distribution. However, a qualified rollover to
a Roth IRA or a designated Roth account is generally not a tax-free
distribution. Use lines 16a and 16b to report a qualified rollover, including a
direct rollover, from one qualified employer’s plan to another or to an IRA or
SEP.
Enter on line 16a the distribution from Form 1099-R, box 1. From
this amount, subtract any contributions (usually shown in box 5) that were
taxable to you when made. From that result, subtract the amount of the qualified
rollover. Enter the remaining amount on line 16b. If the remaining amount is zero
and you have no other distribution to report on line 16b, enter zero on line
16b. Also, enter ‘‘Rollover’’ next to line 16b. See Pub. 575 for more details
on rollovers, including special rules that apply to rollovers from designated
Roth accounts, partial rollovers of property, and distributions under qualified
domestic relations orders.
2010 Roth IRA rollovers
If you rolled over part or all of a qualified retirement plan
(other than a designated Roth account) to a Roth IRA in 2010 and did not elect
to report the taxable amount on your 2010 return, include on line 16b the
amount from your 2010 Form 8606, line 25a. However, you may have to include a
different amount on line 16b (or include an amount on line 15b instead of line
16b) if either of the following applies.
·
You received a distribution from a Roth IRA in
2010 or the owner of the Roth IRA died in 2011. See Pub. 575 to figure the
amount to include on line 16b.
·
You received a distribution from a Roth IRA in
2011. Use Form 8606 to figure the amount to include on line 15b.
2010 in-plan Roth rollovers
If you rolled over part or all of a qualified retirement plan to a
designated Roth account in 2010 and did not elect to report the taxable amount
on your 2010 return, include on line 16b the amount from your 2010 Form 8606,
line 25a. However, you may have to include a different amount on line 16b if either
of the following applies.
·
You received a distribution from your designated
Roth account in 2010 after September 27, or the owner of the designated Roth
account died in 2011. See Pub. 575 to figure the amount to include on line 16b.
·
You received a distribution from the designated
Roth account in 2011. Use Form 8606 to figure the amount to include on line
16b.
Lump-Sum Distributions
If you received a lump-sum distribution from a profit-sharing or
retirement plan, your Form 1099-R should have the ‘‘Total distribution’’ box in
box 2b checked. You may owe an additional tax if you received an early distribution
from a qualified retirement plan and the total amount was not rolled over in a
qualified rollover. For details, see the instructions for line 58. Enter the
total distribution on line 16a and the taxable part on line 16b. For details, see
Pub. 575.
You may be able to pay less tax on the distribution if you were born
before January 2, 1936, or you are the beneficiary of a deceased employee who
was born before January 2, 1936. For details, see Form 4972.
Line 17 –
Rental real estate, royalties, partnerships, S corporations, trusts, etc.
Attach Schedule E
If you have rental real estate, royalties, partnerships,
S corporations, trusts, etc., please use Schedule E to figure out your income
and enter it on your 2011 Form 1040, Line 17.
Line 18 – Farm
income or (loss). Attach Schedule F
If you have a farm income or loss, use Schedule F to
figure out your income or loss and enter the amount on your 2011 Form 1040,
Line 18.
Line 19 -
Unemployment compensation
You should receive a Form 1099-G showing in box 1 the total
unemployment compensation paid to you in 2011. Report this amount on line 19.
However, if you made contributions to a governmental unemployment compensation
program and you are not itemizing deductions, reduce the amount you report on
line 19 by those contributions. If you received an overpayment of unemployment
compensation in 2011 and you repaid any of it in 2011, subtract the amount you
repaid from the total amount you received. Enter the result on line 19. Also,
enter “Repaid” and the amount you repaid on the dotted line next to line 19.
If, in 2011, you repaid unemployment compensation that you included in gross income
in an earlier year, you can deduct the amount repaid on Schedule A, line 23.
But if you repaid more than $3,000, see Repayments in Pub. 525 for details on
how to report the repayment.
Line 20a –
Social security benefits and Line 20b – Taxable amount
You should receive a Form SSA-1099 showing in box 3 the total
social security benefits paid to you. Box 4 will show the amount of any
benefits you repaid in 2011.If you received railroad retirement benefits treated
as social security, you should receive a Form RRB-1099. Use the Social Security
Benefits Worksheet in these instructions to see if any of your benefits are
taxable.
Exception
Do not use the Social Security Benefits Worksheet in these
instructions if any of the following applies.
·
You made contributions to a traditional IRA
for 2011 and you or your spouse were covered by a retirement plan at work or
through self-employment. Instead, use the worksheets in Pub. 590 to see if any
of your social security benefits are taxable and to figure your IRA deduction.
·
You repaid any benefits in 2011 and your total
repayments (box 4) were more than your total benefits for 2011 (box 3). None of
your benefits are taxable for 2011. Also, you may be able to take an itemized deduction
or a credit for part of the excess repayments if they were for benefits you included
in gross income in an earlier year. For more details, see Pub. 915.
·
You file Form 2555, 2555-EZ, 4563, or 8815, or
you exclude employer-provided adoption benefits or income from sources within
Puerto Rico. Instead, use the worksheet in Pub. 915.
Line 21 –
Other income. List type and amount
Do not report on this line any income from self-employment or fees
received as a notary public. Instead, you must use Schedule C, C-EZ, or F, even
if you do not have any business expenses. Also, do not report on line 21 any
nonemployee compensation shown on Form 1099-MISC (unless it is not
self-employment income, such as income from a hobby or a sporadic activity).
Instead, see the instructions on Form 1099-MISC to find out where to report
that income.
Taxable income
Use line 21 to report any taxable income not reported elsewhere on
your return or other schedules. List the type and amount of income. If
necessary, include a statement showing the required information. For more
details, see Miscellaneous Income in Pub. 525.
Examples of income to report on line 21 include the following.
•
Prizes and awards.
•
Jury duty pay. Also, see the instructions for
line 36.
•
Alaska Permanent Fund dividends.
•
Taxable distributions from a Cover-dell
education savings account (ESA) or a qualified tuition program (QTP). Distributions
from these accounts may be taxable if(a) they are more than the qualified
higher education expenses of the designated beneficiary in 2011, and (b) they
were not included in a qualified rollover. See Pub. 970. Nontaxable
distributions from these accounts, including rollovers, do not have to be
reported on Form 1040. You may have to
pay an additional tax if you received a tax able distribution from a Coverdell
ESA or a QTP. See the Instructions for Form 5329.
•
Taxable distributions from a health savings
account (HSA) or an Archer MSA. Distributions from these accounts may be taxable
if (a) they are more than the unreimbursed qualified medical expenses og the
account beneficiary or account holder in 2011, and (b) they were not included
in a qualified rollover. See Pub. 969. You may have to pay an additional tax if
you received a taxable distribution from an HAS or an Archer MSA. See the
Instructions for Form 8889 for HSAs or the Instructions for Form 8853 for
Archer MSAs.
•
Amounts deemed to be income from an HSA
because you did not remain an eligible individual during the testing period.
See Form 8889, Part III.
•
Gambling winnings, including lotteries,
raffles, a lump-sum payment from the sale of a right to receive future lottery
payments, etc. For details on gambling losses, see the instructions for
Schedule A, line 28. Attach Form(s) W-2G to Form 1040 if any federal income tax
was withheld.
•
Alternative trade adjustment assistance (ATAA)
or reemployment trade adjustment assistance (RTAA) payments. These payments
should be shown in box 5 of Form 1099-G.
•
Reimbursements or other amounts received for
items deducted in an earlier year, such as medical expenses, real estate taxes,
general sales taxes, or home mortgage interest. See Recoveries in Pub. 525 for
de- tails on how to figure the amount to report.
•
Income from the rental of personal property if
you engaged in the rental for profit but were not in the business of renting
such property. Also, see the instructions for line 36.
•
Income from an activity not engaged in for
profit. See Pub. 535.
•
Loss on certain corrective distributions of
excess deferrals. See Retirement Plan Contributions in Pub. 525.
•
Dividends on insurance policies ifthey exceed
the total of all net premiums you paid for the contract.
•
Recapture of a charitable contribution
deduction relating to the contribution of fractional interest in tangible
personal property. See Fractional Interest in Tangible Personal Property in
Pub. 526.
•
Recapture of a charitable contribution
deduction if the charitable organization disposes of the donated property
within 3 years of the contribution. See Recapture if no exempt use in Pub. 526.
•
Canceled debts. These amounts may be shown in
box 2 of Form 1099-C. However, part or all of your income from the cancellation
of debt may be nontaxable. See Pub. 4681 or go to IRS.gov and enter “canceled
debt” or “foreclosure” in the search box.
•
Taxable part of disaster relief payments. See
Pub. 525 to figure the taxable part, if any. If any of your disaster relief
payment is taxable, attach a statement showing the total payment received and
how you figured the taxable part.
Nontaxable income.
Do not
report any nontaxable income on line 21. Examples of nontaxable income include
the following.
•
Child support.
•
Payments you received to help you pay your
mortgage loan under the HFA Hardest Hit Fund or the Emergency Homeowners’ Loan
Program or similar state program.
•
Any Pay-for-Performance Success Payments that
reduce the principal balance of your home mortgage under the Home Affordable
Modification Program.
•
Life insurance proceeds received be- cause of
someone’s death (other than from certain employer-owned life insurance
contracts).
•
Gifts and bequests. However, if you received a
gift or bequest from a foreign person of more than $14,375, you may have to
report information about it on Form 3520, Part IV. See the Instructions for Form
3520.
•
Net operating loss (NOL) deduction. Include on
line 21 any NOL deduction from an earlier year. Subtract it from any income on
line 21 and enter the result. If the result is less than zero, enter it in
parentheses. On and show the amount of the deduction in the dotted line next to
line 21, enter “NOL” parentheses. See Pub. 536 for details.
Line 22 – Total
income
Add up all the lines 7 through 21, and this is total
income for the taxable year.
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This concludes the income section of the 2011 Form 1040. Next up is the adjusted gross income section for the 2011 Form 1040.
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