IRS Publication 939


DEFINITION of 'IRS Publication 939'

A document published by the Internal Revenue Service (IRS) that provides guidance on how taxpayers are to treat income from pensions and annuities using the General Rule. The IRS breaks monthly income from pensions and annuities into two parts: a tax-free part made up of the money that was contributed by the individual, and a taxable part that represents the positive return on the investment.

BREAKING DOWN 'IRS Publication 939'

The General Rule is one of two methods used to calculate the tax-free part of a pension or annuity (the other being the Simplified Method, which is covered in IRS Publication 575). Individuals must use the General Rule if they receive income from a non-qualified plan, or plan that does not meet Internal Revenue Code requirements to receive the tax benefits of a qualified plan.

IRS Publication 939 does not cover income from life insurance or individual retirement accounts (IRAs), and does not provide specific information on how to use the Simplified Method.

  1. Annuity

    A financial product that pays out a fixed stream of payments ...
  2. IRS Publication 575

    A document published by the Internal Revenue Service (IRS) that ...
  3. Qualified Retirement Plan

    A plan that meets requirements of the Internal Revenue Code and ...
  4. Pension Fund

    A fund established by an employer to facilitate and organize ...
  5. Non-Qualified Plan

    Any type of tax-deferred, employer-sponsored retirement plan ...
  6. Individual Retirement Account - ...

    An investing tool used by individuals to earn and earmark funds ...
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  1. Are qualified pension plans taxable?

    Qualified retirement plans are fully or partially taxable. If you have no investment in the contract because you have not ... Read Full Answer >>
  2. When can catch-up contributions start?

    Most qualified retirement plans such as 401(k), 403(b) and SIMPLE 401(k) plans, as well as individual retirement accounts ... Read Full Answer >>
  3. Are 401(k) contributions tax deductible?

    All contributions to qualified retirement plans such as 401(k)s reduce taxable income, which lowers the total taxes owed. ... Read Full Answer >>
  4. Are 401(k) rollovers taxable?

    401(k) rollovers are generally not taxable as long as the money goes into another qualifying plan, an individual retirement ... Read Full Answer >>
  5. Are catch-up contributions included in the 415 limit?

    Unlike regular employee deferrals, catch-up contributions are not included in the 415 limit. While there is an annual limit ... Read Full Answer >>
  6. Can catch-up contributions be matched?

    Depending on the terms of your plan, catch-up contributions you make to 401(k)s or other qualified retirement savings plans ... Read Full Answer >>

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