Railroad Retirement Lump Sum Dist

My father will be retiring from the railroad and is due to recieve a lump sum distribuition of 57500 (via a union agreement in 86) this will be reported as earned income on his w-2 for current year,is there anyway to distribute that amount evenly over his years of service as income earned in prior years, thus reducing his overall tax burden on those dollars? Any advice would be appreciated.

While there are options for lump-sum distributions from qualified retirement funds, I don't think this would fit in as this is being reported on the W-2 and the determination was from a union agreement in '86. More facts wouls be necessary to try to think of something.

Is you father going to need the money immediately? What is this exactly? Why is it being reported on a W-2 and not a 1099-R?

never seen it before

we have verified that it will be reported on the w-2 as earned income subject to payroll taxes, so I know it will be fully taxable, the direction i was looking into was if he could claim that he had basically earned it over his years of service rather than all in the year it was paid. i.e 57500/21 yrs 2740 per year over 21 years rather than all in 07. similar to the way you can income average a lump sum from a qualified plan

this is just a strange situation. This money was assigned in 86, recieved no interest, was basically a static amount that is to be paid to all railroad employees (at the time) at retirement so we are just looking for ways to reduce overall tax burden on those dollars.

thanks for your reply as well

Besides putting as much into whatever retirement fund the railroad has and the limit to an IRA, I can't think of anything else. Maybe sell some loser stocks to generate some loss.

that ship has sailed

we've already rode the financials down, so our loss limits are covered, but i appreciate the suggestion.