IRS Publishes 2020 Form 4972, Tax on Lump-Sum Distributions

October 13, 2020

The IRS has published the 2020 version of Form 4972, which is used by participants born before January 2, 1936, and who received a lump-sum distribution from a qualified plan in 2020. The form assists participants in calculating the tax owed on a distribution using the 20% capital gain election, the 10-year tax option or both. These are special formulas used to determine a separate tax on the distribution that may result in a smaller tax than if the amount is reported as ordinary income.

Participants should consult with their accountant for guidance.

IRS Form 4972 »