IRS Issues Updated Publication on Reporting Pension and Annuity Income

By John Iekel • March 07, 2018 • 0 Comments
  1. The IRS on March 2 issued an updated version of Publication 575, “Pension and Annuity Income.” It is to be used in preparing 2017 income tax returns.

    The updated booklet cites two changes for 2017 reporting.

    1. Disaster tax relief. New rules provide for tax-favored withdrawals, repayments and loans from certain retirement plans, including IRAs, for taxpayers who suffered economic losses as a result of Hurricane Harvey or Tropical Storm Harvey, Hurricane Irma, Hurricane Maria or the California wildfires. In addition, disaster tax relief also is available for taxpayers who suffered economic losses as a result of presidentially declared disasters during calendar year 2016 under Section 401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act.

    2. Rollovers of qualified plan offsets. Beginning in 2018, a qualified plan loan offset amount may be rolled over by the due date, including extensions, for filing the tax return for the tax year in which the offset occurs.

    Pub. 757 also contains a reminder concerning net investment income tax (NIIT). For purposes of the NIIT, net investment income does not include distributions from a qualified retirement plan — for example, 401(a), 403(a), 403(b), 408, 408A or 457(b) plans. However, these distributions are taken into account when determining the modified adjusted gross income threshold.