1099-R

[MGC94]

Client got laid off in 2018 had a w2 and 1099-R. 

1099-R in 19, 20, 21 

2022 Dec got a call that she was due more and got retro money 

1099-R is $102,068 fed withheld $14,432 state $650

anything that can be done with the state? Can you amended and spread out over the years where the 3 year rule was applied? (NJ) 

[Just-Lisa-Now-]

Not quite sure I follow.  Are you asking if the money she got in 2022 can be spread out over 3 years?  

[MGC94]

I am. Like the first 3 years she got her pension it wasn't taxed. Now they didn't give her the right amount the last 3 years so I was wondering if I could amend it and spread it over the last 3 years

[rcooley25]

Since the money was not received untill 2022 I dint think it can be spread out over three years<

[Just-Lisa-Now-]

Only Covid related distributions in 2020 were able to be spread over 3 years, distributions received in 2019, 2021 or 2022 dont qualify. 

None of these sound like distribution related to Covid, they sound like regular pension distributions.

[qbteachmt]

"Like the first 3 years she got her pension it wasn't taxed."

If those were not taxable, what makes this arrears amount taxable? Isn't it the same type of payout? Just because there is withholding does not control if something is or is not taxable.

[taxes96786]

I would ask the IRS attorney office for clarification and how to report.

[sjrcpa]

Really?

[IRonMaN]

I guess that is at least a refreshing change from "see pub 17".  Totally useless answer, but something new anyway.🙄

[MGC94]

This is the state of NJ 3 year rule for pensions not being taxed 

[Just-Lisa-Now-]

So youre only asking about NJ state taxes, not federal...that wasnt very clear in your original post. 

You may want to edit the title of your post to include NJ, so those that are familiar with NJ rules might see it quicker.

[abctax55]

And since I'm sure you have that number handy, if not memorized, could you please post it for the OP to use?  TIA

[qbteachmt]

I found you this:

https://www.state.nj.us/treasury/taxation/njit7.shtml

Make sure to expand each section. It also has the link to this:

https://www.state.nj.us/treasury/taxation/pdf/pubs/tgi-ee/git1&2.pdf

You have some reading to do, because there are a lot of limitations and eligibility and qualifications, including percentages based on income levels and marital status.

Have fun.

[BobKamman]

The income-averaging law was repealed as part of the 1986 tax act. Who signed it? Here’s a hint. He said, “I think you all know that I've always felt the nine most terrifying words in the English language are: I'm from the Government, and I'm here to help.”