96-076
Response
April 1, 1996 and May 15, 1996
Request
I've
been told by a preparer in Utah that, when computing the retirement income
subtraction, AGI on line 4, Schedule B, must be increased by the amount of a
lump-sum distribution taxed on Form 4972. I cannot find any ruling or
regulation that supports this assertion. Can you tell me whether or not this is
correct and, if so, provide a reference.
Thanks
for your help.
It is the opinion of the Customer
Service and Individual Income Tax Auditing Divisions that the lump sum distribution
reported on line 16 of the 1995 Utah return must be included on Schedule B Line
4 of that same return.
You may wish to request an advisory
opinion from the Commission. You may do so, by submitting your written request
to:
Advisory
Opinion
Utah
State Tax Commission
210
North 1950 West
Salt
Lake City UT 84134
XXXXX
Advisory
Opinion
Utah
State Tax Commission
210
North 1950 West
Salt
Lake City, UT 84134
Dear
Sir or Madam:
With
respect to the Utah retirement deduction, is a lump-sum distribution taxed on
Form 4972 required to be added to AGI on line 4, Schedule B? Enclosed is a
response I received from Customer Service over the Internet.
If
you agree this addition is required, I suggest that you modify the instructions
for line 4 so that all individuals complete this line in the same manner.
We
will use this information to update our tax return preparation software for
1996, which we, of course, wish to make as accurate as possible.
Thanks
for your help.
Sincerely,
XXXXX
XXXXX
Re: Advisory opinion - lump sum distribution
Dear
XXXXX
We have received your request for
information pertaining to lump-sum retirement distributions. We find as follows:
A
lump-sum distribution amount shown on the federal form 4972 must be added back
into the taxpayer’s income on line 16 of the income tax form. It must also be included in line 4 of
Schedule B to calculate the amount of the retirement income deduction. §59-10-114 Utah Code Ann. We agree that the form and the instructions
should be amended to include that information.
Thank you for bringing it to our attention.
For the Commission,
Alice Shearer,
Commissioner