Reporting Services (ERS)
FREQUENTLY ASKED QUESTIONS (FAQs):
1099-Rs (2008)
Q.1 Why did I receive one or more 1099-Rs from SBCERA?
SBCERA is required to report distributions and retirement payments on the IRS 1099-R form. These distributions/payments include payments for refunds, disability retirements, service retirements, continuances, death benefits, survival benefits, burial benefits and DROs. A separate 1099-R is issued for each individual payment type described above. For instance, if you are a retiree and you also receive a continuance from a deceased retiree, then you would receive two 1099-Rs― one for the normal retirement payment and one for the continuance payment.
Q.2 What is Box 1― Gross Distribution?
The Gross Distribution is the total distribution/payment amount paid by SBCERA.
Q.3 What is Box 2a― Taxable Amount and why is it different than Box 1?
The Taxable Amount is the amount of the distribution/payment that is deemed to be taxable per the IRS. The amount is actually determined by SBCERA using IRS guidelines. Common reasons that the Taxable Amount will show an amount less than Gross Distribution are as follows:
1) The member’s payment is partially or completely non-taxable because of a duty disability; or,
2) The member’s payment is partially or completely non-taxable due an amount contained in Box 5 (this is called a “Safe Harbor” amount and is based on the member’s after-tax contributions made before they retired).
Q.4 What are the check boxes in Box 2b?
The “Taxable Amount Not Determined” box indicates that SBCERA is unable to determine the taxability of the distribution/payment. This box is checked for all members who retired before July 1, 1986, and for some retirees with a “heart presumptive” disability.
The “Total Distribution” box indicates that SBCERA paid a refund of contributions to the recipient due to death or termination of employment.
Q.5 What is Box 4― Federal Income Tax Withheld?
The federal tax withheld from the distribution/payments received from SBCERA.
Q.6 What is Box 5― Employee Contributions/Designated Roth Contributions or Insurance Premiums?
The amount in Box 5 indicates the portion of the distribution/payment that is nontaxable due to after-tax contributions made by the member while he/she was still an active employee. The amount in Box 5 is referred to as the “Safe Harbor” amount. The amount in Box 5 is not a deduction nor the amount the retiree paid for health insurance.
Q.7 What is Box 7― Distribution Codes?
The distribution codes describe the type of distribution/payment from SBCERA. A complete listing of code descriptions is included in the 1099-R Instructions (provided to the payee along with the 1099-R). The most common codes and descriptions used by SBCERA are as follows:
Code 1: Refund before the age of 59 ½, or service retirement under 55 (General) or 50 (Safety)
Code 2: Service retirement between 55 and 59 ½ (General) or 50 and 59 ½ (Safety)
Code 3: Disability retirement
Code 4: Death Payments including Continuance
Code 7: Refund or service retirement after the age of 59 ½
Code G: Rollover of contributions to a qualified plan
Q.8 What is Box 10― State Tax Withheld?
The state tax withheld from the distribution/payments received from SBCERA.
Q.9 What is Box 11― State/Payer’s State No.?
The State/Payer account number is only included in this box for members who had State taxes withheld from their SBCERA distribution/payment. If required by a member who did not have State taxes withheld from SBCERA, the account number is 80311772.
