| Pub. 575, Pension and Annuity Income |
2004 Tax Year |
This is archived information that pertains only to the 2004 Tax Year. If you
are looking for information for the current tax year, go to the Tax Prep Help Area.
Form 4972 Tax on Lump-Sum Distributions 2003. Summary: This is an example of Form 4972 (2003) with items included as described in the text. Additionally, these line items
are also
completed:
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Under
“Name of recipient of distribution”field contains Robert C. Smith
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Under
“Identifying number”field contains 002–00–3456
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Under
“Part I: Complete this part to see if you can use Form 4972”:
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“1. Was this a distribution of a plan participant's entire balance (excluding deductible voluntary employee contributions and
certain forfeited
amounts) from all of an employer's qualified plans of one kind (pension, profit-sharing, or stock bonus)? If No, do not use
this form. YES”
checkbox checked
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“2. Did you roll over any part of the distribution? If Yes, do not use this form. NO” checkbox checked
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“3. Was this distribution paid to you as a beneficiary of a plan participant who was born before 1936? NO” checkbox checked
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“4. Were you (a) a plan participant who received this distribution, (b) born before 1936, and (c) a participant in the plan
for at least 5
years before the year of the distribution? YES” checkbox checked
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“5a. Did you use Form 4972 after 1986 for a previous distribution from your own plan? If Yes, do not use this form for a 2002
distribution from
your own plan. NO” checkbox checked
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Under
“Part II: Complete this part to choose the 20% capital gain election (see instructions)”:
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“6. Capital gain part from Form 1099-R, box 3” field contains 10,000
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“7. Multiply line 6 by 20% (.20)” field contains 2,000
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Under
“Part III: Complete this part to choose the 10-year tax option (see instructions)”:
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“8. Ordinary income from Form 1099-R, box 2a minus box 3. If you did not complete Part II, enter the taxable amount from Form
1099-R, box
2a” field contains 140,000
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“10. Total taxable amount. Subtract line 9 from line 8” field contains 140,000
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“11. Current actuarial value of annuity from Form 1099-R, box 8. If none, enter 0” field contains 0
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“12. Adjusted total taxable amount. Add lines 10 and 11. If this amount is $70,000 or more, skip lines 13 through 16, enter
this amount on line
17, and go to line 18” field contains 140,000
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“17. Subtract line 16 from line 12” field contains 140,000
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“19. Subtract line 18 from line 17. If line 11 is zero, skip lines 20 through 22 and go to line 23” field contains 140,000
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“23. Multiply line 19 by 10% (.10)” field contains 14,000
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“24. Tax on amount on line 23. Use the Tax Rate Schedule in the instructions” field contains 2,227
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“25. Multiply line 24 by ten (10). If line 11 is zero, skip lines 26 through 28, enter this amount on line 29, and go to line
30” field
contains 22,270
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“29. Subtract line 28 from line 25. (Multiple recipients, see instructions)” field contains 22,270
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“30. Tax on lump-sum distribution. Add lines 7 and 29. Also include this amount in the total on Form 1040, line 42, or Form
1041, Schedule G,
line 1b, whichever applies” field contains 24,270
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