- 6 -
the base amount and the adjusted base amount are zero. Sec.
86(c)(1)(C) and (2)(C).
Social Security benefits are included in the recipient’s
gross income in the taxable year in which the benefits are
received. Sec. 86(a)(1). An election may be made by taxpayers
who receive lump-sum payments of Social Security benefits during
the taxable year in which a portion of the benefits is
attributable to previous taxable years. Sec. 86(e). Section
86(e) provides that, if the election is made, the amount included
in gross income for the taxable year of receipt must not exceed
the sum of the increases in gross income for those previous
taxable years that would result from taking into account the
portion of the benefits attributable to the previous taxable
years. Accordingly, if no election is made by the taxpayer under
section 86(e), lump-sum distributions of Social Security benefits
are includable in the taxpayer’s gross income in the taxable year
the benefits are received.
Petitioner did not make an election under section 86(e) with
respect to the lump-sum Social Security disability benefits
received in 1999. He concedes that his proper filing status for
the 1999 taxable year is married filing separately. Furthermore,
he does not claim that he lived apart from Mrs. Sharp after their
marriage in 1999, and nothing in the record suggests that he did.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 Next
Last modified: May 25, 2011