Understanding Your PBGC Benefits at Tax Time
Pension Benefit Guaranty Corporation (PBGC) sent this bulletin at 02/04/2014 05:39 PM EST |
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By now, you have probably received your Form 1099-R from us.
As you arrange to have your income taxes prepared and filed, we would like to share some important information about PBGC benefits and taxes.
While PBGC is required to withhold federal income tax, we do not withhold for state taxes. If your state has an income tax, you may owe tax on your PBGC benefit. To find out more, contact your state tax office (Excel file, 14.4 KB).
Also, if you receive a benefit from PBGC, we report the amount annually to the IRS.
For income tax purposes, each January PBGC sends you an IRS Form 1099-R that states the amount we paid you the previous year.
If you need a Form 1099-R for 2013 and haven't received it, PBGC will get you one.
The IRS has a tool, "Is My Pension or Annuity Payment Taxable?" that will help you determine if your pension or annuity payment from an employer-sponsored retirement plan is taxable.
