Unrecovered contributions that were previously taxed for deceased spouse?

Forum|Forum|5 years ago
April 3, 2021
1 reply
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Has anyone had to deal with a surviving spouse receiving a letter from TRS Illinois about an amount that was "unrecovered contributions that were previously taxes". The letter says to refer to publication 575 but I can't find anything other than simplified method that has to do with this subject?

Lacerte Tax

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BobKamman

Level 15

Last paragraph of Page 12

Exclusion limited to cost. If your annuity starting
date is after 1986, the total amount of annuity income that
you can exclude over the years as a recovery of the cost
can't exceed your total cost. Any unrecovered cost at your
(or the last annuitant's) death is allowed as an itemized
deduction on the final return of the decedent.

(I think that's one of the itemized deductions that TCJA suspended, but you can look it up.)

rbynaker

Level 13

@BobKamman wrote:

(I think that's one of the itemized deductions that TCJA suspended, but you can look it up.)

This one actually survived TCJA. It's in 67(b)(10) in one of the "other than" paragraphs keeping it out of the 2% bucket. But you still have to get over the standard deduction hurdle to get any benefit.

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