Form 1040 Simplified Method Worksheet PDF Details

Navigating tax forms can often feel overwhelming, yet understanding them is crucial for accurately reporting income and ensuring the correct tax liability. Among these, the 1040 Simplified Method Worksheet holds significant importance for those receiving pension or annuity payments. Specifically designed for beneficiaries of deceased employees or former employees who passed before August 21, 1996, this form assists in calculating the taxable part of pension and annuity payments. Contributions toward these plans, recovery of investment in the contract, and the exclusions applicable, such as the potential $5,000 death benefit exclusion, are critical elements considered within this calculation. Individuals receiving multiple pensions or annuities must determine the taxable part of each separately, ensuring the accuracy of totals reported on Form 1040, lines 16a and 16b. The worksheet guides you through including total payments received, determining the cost in the plan at the annuity's starting date, and applying the appropriate divisor from provided tables to ascertain the taxable amount. This delicate balancing act between what was contributed and what is received as income underscores the necessity of the Simplified Method Worksheet in facilitating a clearer understanding and adherence to tax obligations.

QuestionAnswer
Form NameForm 1040 Simplified Method Worksheet
Form Length1 pages
Fillable?No
Fillable fields0
Avg. time to fill out15 sec
Other namessimplified method pension, irs worksheet a simplified method for 2015, 2015 simplified, irs simplified method online worksheet

Form Preview Example

Before you begin:

2017 Form 1040—Lines 16a and 16b

 

Simplified Method Worksheet—Lines 16a and 16b

Keep for Your Records

If you are the beneficiary of a deceased employee or former employee who died before August 21, 1996, include any death benefit exclusion that you are entitled to (up to $5,000) in the amount entered on line 2 below.

More than one pension or annuity. If you had more than one partially taxable pension or annuity, figure the taxable part of each separately. Enter the total of the taxable parts on Form 1040, line 16b. Enter the total pension or annuity payments received in 2017 on Form 1040, line 16a.

1.Enter the total pension or annuity payments from Form 1099-R, box 1. Also, enter this amount on Form 1040,

line 16a

. . . . . . . . . . . . . .

. . . . . .

.

.

.

.

.

.

.

. . . . . . . . 1.

2. Enter your cost in the plan at the annuity starting date

. . . . . .

.

.

.

.

.

.

.

2.

 

 

 

 

Note. If you completed this worksheet last year, skip line 3 and enter the amount from line 4 of last year’s worksheet on line 4 below (even if the amount of your pension or annuity has changed). Otherwise, go to line 3.

3.Enter the appropriate number from Table 1 below. But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, enter the appropriate

number from Table 2 below . . .

. . .

.

. . . . . . . . . . .

. .

.

3.

4. Divide line 2 by the number on line 3

. . .

.

. . . . . . . . . . .

. .

.

4.

5.Multiply line 4 by the number of months for which this year’s payments were made. If your annuity starting date was before 1987, skip lines 6 and 7 and enter this amount on line 8.

Otherwise, go to line 6 . . . . . . . . . . . . . . . . . . . . . . . 5.

6.Enter the amount, if any, recovered tax free in years after 1986. If you completed this

 

worksheet last year, enter the amount from line 10 of last year’s worksheet

. . . . . .

6.

 

 

7.

Subtract line 6 from line 2

. . . . . . .

7.

 

 

 

 

8.

Enter the smaller of line 5 or line 7

. . . . . . .

. . . . . . . . 8.

9.Taxable amount. Subtract line 8 from line 1. Enter the result, but not less than zero. Also, enter this amount on Form 1040, line 16b. If your Form 1099-R shows a larger amount, use the amount on this line instead of the amount from Form 1099-R. If you are a retired public safety officer, see Insurance Premiums for Retired Public Safety Officers

before entering an amount on line 16b . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10.Was your annuity starting date before 1987?

Yes.

STOP

Do not complete the rest of this worksheet.

No.

 

 

 

 

Add lines 6 and 8. This is the amount you have recovered tax free through 2017. You will need this

 

number if you need to fill out this worksheet next year . . . . . . . . . . . . . . . . . 10.

11.Balance of cost to be recovered. Subtract line 10 from line 2. If zero, you won’t have to complete this

worksheet next year. The payments you receive next year will generally be fully taxable

. . . . . . . . 11.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Table 1 for Line 3 Above

 

 

 

 

 

 

 

 

 

 

AND your annuity starting date was—

 

IF the age at annuity starting

before November 19, 1996,

 

after November 18, 1996,

 

date was . . .

 

enter on line 3 . . .

 

 

enter on line 3 . . .

 

 

55 or under

300

 

 

360

 

 

 

 

56–60

260

 

 

310

 

 

 

 

61–65

240

 

 

260

 

 

 

 

66–70

170

 

 

210

 

 

 

 

71 or older

120

 

 

160

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Table 2 for Line 3 Above

 

 

 

 

 

 

 

IF the combined ages at annuity

 

 

 

 

 

 

 

 

 

 

starting date were . . .

 

 

THEN enter on line 3 . . .

 

 

110 or under

 

 

 

410

 

 

 

 

 

 

111–120

 

 

 

360

 

 

 

 

 

 

121–130

 

 

 

310

 

 

 

 

 

 

131–140

 

 

 

260

 

 

 

 

 

 

141 or older

 

 

 

210

 

 

 

 

 

Need more information or forms? Visit IRS.gov.

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Part number 1 in submitting irs worksheet a simplified method for 2015

2. Now that the last array of fields is done, you're ready include the essential particulars in Balance of cost to be recovered, IF the age at annuity starting, or under or older, IF the combined ages at annuity, or under or older, Table for Line Above, AND your annuity starting date was, before November enter on line, Table for Line Above, after November enter on line, and THEN enter on line allowing you to move on further.

Balance of cost to be recovered, IF the combined ages at annuity, and after November enter on line of irs worksheet a simplified method for 2015

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