Questions & Answers

What is the Lump Sum Retirement Credit?

Ohio lets you claim a credit if you cashed out the entire balance of an employee benefit plan (like a 401(k) or pension) during one year because of retirement. This is also known as a "total distribution" on Form 1099-R.

The credit replaces the standard Retirement Income Credit that people with retirement income can claim each year. It's intended to give the benefits of that credit to people that receive all of their retirement income at once instead.

If you claimed a Lump Sum Retirement Credit in a prior year you won't be eligible to claim the credit again, but you may be able to claim an annual credit carryforward based on any amount that didn't reduce your tax (because your tax was too low) in the year you originally claimed it.

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