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Complete Form 4972 - Tax on lump-sum distributions

Use the
1099R
 screen in the Income folder to complete Form 4972. Use distribution code A and answer all questions in the Form 4972 section (on the
1099R-2
 screen for individual returns) to determine if the taxpayer qualifies for lump-sum averaging.
  • Entire distribution from qualified pension, profit sharing, or stock plan:
     Indicate if this distribution was the plan participant's entire balance from the qualified plan. If you enter no, you can't use Form 4972.
  • Part of the distribution rolled over:
     If any part of this distribution was rolled over into another qualified plan (answer yes), you can't use Form 4972.
  • Distribution paid to a death beneficiary of a plan participant:
     Enter
    1
     for Yes if this distribution was paid to a beneficiary of a plan participant who died after reaching age 59 1/2 or who was born before 1936.
  • Plan participant born before 1936 and participant for at least 5 years prior to the distribution:
     Enter
    1
     for Yes or
    2
     for No to indicate if the plan participant who received this distribution was born before January 2, 1936 and was in the plan at least 5 years before the year of distribution.
  • Form 4972 used by participant in a prior year
    : If Form 4972 was used after 1986 for a previous distribution, you can't use Form 4972.
  • Form 4972 used by beneficiary in a prior year
    : If this distribution is being paid to a beneficiary who used Form 4972 after 1986 for a previous distribution from the plan participant, you can't use Form 4972.
  • Include net unrealized appreciation in income
    : Enter information to elect to include unrealized appreciation on employer securities, shown in 1099-R, box 6, in income. UltraTax CS automatically prints the election with the return. If the return is being filed electronically, the tax election will be included in the electronic file.
  • Federal estate tax attributable to lump-sum distribution
    : Enter the amount of federal estate tax paid on this lump-sum distribution. If making the capital gain election, UltraTax CS decreases the capital gain amount by the applicable estate tax.
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