Instructions For Schedule G-1 - Tax On Lump-Sum Distributions

If you make the 5 .5% capital gain election and

write “NUA” and the amount of NUA included,

applies to the beneficiaries or estates of

you are taking the death benefit exclusion,

or include it according to your software’s

common-law employees, self-employed

figure the amount to enter using the Death

instructions .

individuals, and shareholder-employees who

Benefit Worksheet below .

owned more than 2% of an S corporation .

Line 9 – If you received a distribution in 2016

Death Benefit Worksheet

because of the plan participant’s death that

Line 11 – Divide the amount shown on federal

A. Enter the capital gain amount from

occurred before August 21, 1996, you may

Form 1099-R, box 8, by the percentage shown

federal Form 1099-R, box 3 . If you

exclude up to $5,000 of the distribution from

on federal Form 1099-R, box 8 .

elected to include NUA in taxable

your gross income . However, if part of the

Line 19 and Line 25 – Use the Tax Rate

income, enter the amount from

death benefit exclusion was allowed in Part II,

Schedule below to complete Part III, line 19 or

line G of the NUA Worksheet in

you must reduce the allowable exclusion by

line 25 .

federal Form 4972 instructions

_______

the amount on line E of the Death Benefit

Line 21 – Decimals should be carried to four

B. Enter the taxable amount from

Worksheet on this page .

places and rounded to three places . Drop

federal Form 1099-R, box 2a . If you

If the trust for which you are filing shared the

amounts 4 and under ( .4434 becomes .443) .

elected to include NUA in taxable

lump-sum distribution with other trusts, it will

Round amounts 5 and over up to the next

income, add the amount from

share the exclusion in the same proportion

number ( .4445 becomes .445) .

federal Form 1099-R, box 6, to the

as it shared the distribution . This exclusion

amount from federal Form 1099-R,

box 2a, and enter the total here

_______

Tax Rate Schedule for Part III, 10-Year Averaging

C. Divide line A by line B and enter

the result as a decimal

_ ._ _ _ _

If the amount on Part III,

Enter on Part III, line 19 or line 25

D. Enter your share of the death

line 18 or line 24 is:

benefit exclusion*

_______

of the

E. Multiply line D by line C

_______

amount

F. Subtract line E from line A .

Over – But Not Over –

over–

Enter the result here and on

$ 3,490

0 .00 PLUS

1 .0%

Schedule G-1, line 6

_______

3,490

6,110

34 .90 PLUS

2 .0%

3,490

*The $5,000 death benefit exclusion for

6,110

8,710

87 .30 PLUS

3 .0%

6,110

employer-provided death benefits applies

8,710

11,360

165 .30 PLUS

4 .0%

8,710

only for decedents who died before

11,360

13,980

271 .30 PLUS

5 .0%

11,360

August 21, 1996 . If there are multiple

13,980

16,630

402 .30 PLUS

6 .0%

13,980

recipients of the distribution, allocate the

16,630

19,220

561 .30 PLUS

7 .0%

16,630

$5,000 maximum death benefit exclusion

19,220

21,850

742 .60 PLUS

8 .0%

19,220

among the recipients in the same proportion

21,850

24,460

953 .00 PLUS

9 .0%

21,850

that they share the distribution .

24,460

27,090

1,187 .90 PLUS

10 .0%

24,460

Enter the remaining allowable death benefit

27,090

AND OVER

1,450 .90 PLUS

11 .0%

27,090

exclusion in Part III, line 9, and see the

Multiple Recipients of a Lump-Sum Distribution

instructions for line 9 .

If you file for a trust that shared the distribution with other trusts, figure the tax on the whole

Part III

lump-sum first . The trusts then share the tax in the same proportion that they shared the

distribution .

To figure your tax on the lump-sum distribution

with the 10-year averaging method, complete

If you shared a lump-sum distribution from a qualified retirement plan when not all recipients were

line 8 through line 28 .

trusts (a percentage will be shown on federal Form 1099-R, box 8 and/or box 9a), figure the tax on

your distribution as follows:

Line 8 (Multiple recipients of a lump-sum

distribution see box to the right)

Use the table below to determine the amount to enter on Schedule G-1, line 8 .

Community property laws do not apply to

figuring tax on the amount you report on line 8 .

Is Net Unrealized

If in Part II

Appreciation (NUA)

If you made the 5 .5% capital gain election

– Computation–

included in your

(Part II), enter only the ordinary income from

Use federal Form 1099-R

federal Form 1099-R on this line . To figure

taxable income?

Amounts

this amount, subtract federal Form 1099-R,

Divide box 2a by the percentage in box 9a .

You did not make

box 3, from federal Form 1099-R, box 2a .

the 5 .5% capital gain

Enter the result on line 8 . If you included NUA

Add box 2a and box 6 . Divide the result by

YES

election .

capital gain in the 5 .5% capital gain election,

the percentage in box 9a .

then add the amount from line F of the NUA

Subtract box 3 from box 2a . Divide the result

Worksheet in federal Form 4972 instructions to

by the percentage in box 9a .

You made the

the ordinary income amount computed in this

5 .5% capital gain

Subtract box 3 from box 2a . Add to line F of the

paragraph .

election .

NUA Worksheet on page 3 of federal Form 4972

If you did not make the 5 .5% capital gain

YES

instructions . Then divide the result by the

election and did not elect to include NUA in

percentage of distribution shown in box 9a .

taxable income, enter the amount from federal

Form 1099-R, box 2a .

Line 28 – Complete the following worksheet:

If you did not make the 5 .5% capital gain

A. Enter your percentage of distribution from federal Form 1099-R, box 9a . . . . . . . . A ___________

election but did elect to include NUA in your

B. Enter the amount from Schedule G-1, line 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B ___________

taxable income, add the amount from federal

C. Multiply line A by the amount on line B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C ___________

Form 1099-R, box 2a, to the amount from

D. Enter the amount from Part II, line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D ___________

federal Form 1099-R, box 6 . Enter the total on

line 8 . On the dotted line to the left of the entry,

E. Add line C and line D . Enter the result here and on line 28 . . . . . . . . . . . . . . . . . . . . E ___________

Schedule G-1 Instructions 2016 Page 2

Instructions For Schedule G-1 - Tax On Lump-Sum Distributions - 2016 Page 2

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