Publication 721 - Tax Guide To U.s. Civil Service Retirement Benefits - 2002 Page 16
ADVERTISEMENT
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28the FECA payment sent directly to your employing agency
You are retired on permanent and total disability if:
or the OPM.
1) You were permanently and totally disabled when you
Claim the deduction on Schedule A (Form 1040) as a
retired, and
miscellaneous itemized deduction, subject to the
2%-of-adjusted-gross-income limit. It is considered a busi-
2) You retired on disability before the close of the tax
ness loss and may create a net operating loss if your
year.
deductions for the year are more than your income for the
Even if you do not retire formally, you are considered
year. Get Publication 536, Net Operating Losses (NOLs)
retired on disability when you have stopped working be-
for Individuals, Estates, and Trusts, for more information.
cause of your disability.
The repayment is not eligible for the special tax credit that
applies to repayments over $3,000 of amounts received
Permanently and totally disabled. You are permanently
under a claim of right.
and totally disabled if you cannot engage in any substantial
If you repay sick leave or disability annuity payments in
gainful activity because of your physical or mental condi-
the same year you receive them, the repayment reduces
tion. A physician must certify that your condition is ex-
the taxable sick pay or disability annuity you include in
pected to result in death or has lasted, or can be expected
income. Do not deduct it separately.
to last, continuously for 12 months or more. Substantial
gainful activity is the performance of significant duties
Terrorist attack. For tax years ending after September
over a reasonable period of time while working for pay or
10, 2001, disability payments for injuries incurred as a
profit, or in work generally done for pay or profit.
direct result of a terrorist attack directed against the United
States (or its allies), whether outside or within the United
Physician’s statement. If you are under 65, you must
States, are not included in income. For more information
have your physician complete a statement certifying that
about payments to survivors of terrorist attacks, see Publi-
you are permanently and totally disabled on the date you
cation 3920, Tax Relief for Victims of Terrorist Attacks.
retired. You must keep this statement for your tax records.
Military actions. For tax years ending after September
You can use the Physician’s Statement in the instructions
10, 2001, disability payments for injuries incurred as a
for either Schedule R (Form 1040) or Schedule 3 (Form
direct result of a military action involving the Armed Forces
1040A).
of the United States and resulting from violence or aggres-
Mandatory retirement age. This is the age set by your
sion against the United States or any of its allies (or threat
employer at which you would have had to retire if you had
thereof), are not included in income.
not become disabled. There is no mandatory retirement
Disability resulting from military service injuries. If
age for most federal employees. However, there is a
you received tax-exempt benefits from the Department of
mandatory retirement age for the following employees.
Veterans Affairs for personal injuries resulting from active
•
An air traffic controller appointed after May 15, 1972,
service in the armed forces and later receive a CSRS or
by the Department of Transportation or the Depart-
FERS disability annuity for disability arising from the same
ment of Defense generally must retire by the last day
injuries, you cannot treat the disability annuity payments as
of the month in which he or she reaches age 56.
tax-exempt income. They are subject to the rules de-
•
scribed earlier under Disability Annuity.
A firefighter employed by the U.S. Government who
is otherwise eligible for immediate retirement gener-
Payment for unused annual leave. When you retire, any
ally must retire by the last day of the month in which
payment for your unused annual leave is taxed as wages
he or she reaches age 57 or, if later, completes 20
in the tax year you receive the payment.
years of firefighter service.
•
Credit for the Elderly or the Disabled
A law enforcement officer employed by the U.S.
Government who is otherwise eligible for immediate
You can take the credit for the elderly or the disabled if:
retirement generally must retire by the last day of the
•
month in which he or she reaches age 57 or, if later,
You are a qualified individual, and
completes 20 years of law enforcement service.
•
Your income is not more than certain limits.
Figuring the credit. If you figure the credit yourself, fill out
You are a qualified individual for this credit if you are a
the front of either Schedule R (if you are filing Form 1040)
U.S. citizen or resident and, at the end of the tax year, you
or Schedule 3 (if you are filing Form 1040A). Next, fill out
are:
Part III of either Schedule R or Schedule 3.
1) Age 65 or older, or
If you want the Internal Revenue Service to figure your
tax and credits, including the credit for the elderly or the
2) Under age 65, retired on permanent and total disabil-
disabled, see Publication 967, The IRS Will Figure Your
ity, and
Tax, and the instructions for Schedule R (Form 1040) or
Schedule 3 (Form 1040A).
a) Received taxable disability income, and
b) Did not reach mandatory retirement age (defined
More information. For detailed information about this
later) before the tax year.
credit, get Publication 524.
Page 16
ADVERTISEMENT
0 votes
Related Articles
Related forms
Related Categories
Parent category: Financial