1099-R - Box 2a says "UNKNOWN"

Forum|Forum|2 years ago
February 8, 2024
3 replies
16 views

I have a client who has a 1099-R from OPM Retirement Operations due to him being injured while serving overseas. He is on disability retirement from the army because of this incident. He is 45 years old. Box 2a says "UNKNOWN". Box 7 has code 3 for disability.

Based on my research it appears that I leave box 2a blank as this is not taxable to him due to being injured while serving overseas. Is that my correct understanding?

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qbteachmt

Level 15

You're going to want a lot of bookmarks for your permanent reference materials:

https://www.opm.gov/faq/retire/You-have-a-calculator-to-determine-taxable-income-for-income.ashx

Don't yell at us; we're volunteers

J

Jefro573Author

Level 3

Thank you very much. Link just sends me to a page with "404 Page not Found". Is there another link I could try?

abctax55

Level 15

Try again, or maybe a different browser? The link works for me.

Or, type the link directly into your browser.

HumanKind... Be Both

T

Terry53029

Intuit Community Champion

If you can't reach the link here is a instruction on the page.

"f you retired under the disability provision, the disability annuity you receive from CSRS or FERS is taxable as wages until you reach minimum retirement age. Your retirement contributions are shown on the 1099R form we send you each January for tax filing purposes."

J

Jefro573Author

Level 3

Thank you. My confusion comes on rather or not since they were injured while serving overseas and medically claimed to be retired due to disability from this incident, does that make it non taxable to them. Even if they haven't reached retirement age? I am thinking it is taxable but how do I go about calculating what portion of the 46,149 is taxable to them?

T

Terry53029

Intuit Community Champion

Looks like his full retirement is taxable until he reaches normal retirement age. This is from pub 721.

Disability Annuity
If you retired on disability, the disability annuity you receive
from the CSRS or FERS is taxable as wages until you
reach minimum retirement age, as explained in this section. However, beginning on the day after you reach minimum retirement age, your payments are treated as a retirement annuity and you can begin to recover the cost of
your annuity under the rules discussed earlier.

link to pub 972. https://www.irs.gov/pub/irs-pdf/p721.pdf