PG Calc Blog

Ready or not, it’s year-end again, which leads us right into tax season – that “most wonderful time of the year!” Here is our quick review of the tax reporting process for life income gifts.

It’s tax season, and there are some dos and don’ts you should be aware of as you prepare your donors’ 1099-Rs. DO mail a 1099-R to your gift annuitants so it is received by them on or before Monday, February 2, 2015 (January 31 is usually the deadline but we get a few more days because it’s a Saturday this year).

If filing fewer than 250 1099-Rs per organization tax ID number, you may submit Copy A of the paper form or file electronically with the IRS. If filing 250 or more, you must submit 1099-R information to the IRS electronically.  Please note the IRS accepts only paper or electronic filing for information returns.

On December 16, 2011, the Internal Revenue Service (IRS) provided new 1099-R Instructions for annuitants that describe how to report 1099-R income on a Federal Income Tax return. Prior to then, these instructions stated that capital gains in Box 3 of the 1099-R should be reported on Form 1040 Schedule D line 13. The new instructions, in contrast, say the following: