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Tax on "Pension Distribution" from deceased father

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M

My fair share

Guest
In 1999 I received a check from the attorney handling my father's estate. This check was for 80% of the total amount. Included were:

1) A letter saying that the check was issued as a result of a "class action settlement with XYZ Co. retirement. This is taxable income to you for 1999"

2) A copy of another check, sent to IRS, in my name, as withholding, which was 20% of the total amount.

3) A "SCHEDULE K-1 - Form 1041," issued in my name, where the entire amount (less admin. costs) is listed under "Other" and noted as a "PENSION DISTRIUTION. - XYZ co." (line 41c).

My question is, can I consider this a "Qualified Retirement Plan" distribution, and can I use form 4972, "Tax on Lump-Sum Distributions" to calculate my tax? If so, I can save several thousand dollars by using the "10 year tax" option.

How can I find out if this is a "qualified" plan, and if it is NOT, is there anything else that I can do to reduce my tax on this amount?

Thank you in advance!



 


ALawyer

Senior Member
Asy your accountnat! The lawyer who sent you the check will also be able to answer some of the questions, but it does not sound like a plan distribution asset as such.

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