Form 4972 (2020)
See Capital Gain Election, earlier, before
completing Part II.
Line 6. Leave this line blank if your
distribution doesn’t include a capital gain
amount or you aren’t making the 20% capital
gain election, and go to Part III.
Generally, enter on line 6 the amount from
Form 1099-R, box 3. However, if you elect to
include NUA in your taxable income, use the
NUA Worksheet, earlier, to figure the amount
to enter on line 6. If you are taking a death
benefit exclusion (see Line 9 below for the
definition), use the Death Benefit Worksheet,
earlier, to figure the amount to enter on line 6.
The remaining allowable death benefit
exclusion should be entered on line 9 if you
choose the 10-year tax option.
If any federal estate tax was paid on the
lump-sum distribution, you must decrease the
capital gain amount by the amount of estate
tax applicable to it. To figure this amount, you
must complete the Death Benefit Worksheet,
earlier, through line C, even if you don’t take
the death benefit exclusion. Multiply the total
federal estate tax paid on the lump-sum
distribution (get this amount from the
administrator of the deceased’s estate) by the
decimal on line C of the Death Benefit
Worksheet. The result is the portion of the
federal estate tax applicable to the capital
gain amount. Then, use that result to reduce
the amount in Form 1099-R, box 3, if you
don’t take the death benefit exclusion, or
reduce line F of the Death Benefit Worksheet
if you do. Enter the remaining capital gain on
line 6. If you elected to include NUA in taxable
income and you didn’t take the death benefit
exclusion, subtract the portion of federal
estate tax applicable to the capital gain
amount from the amount on line G of the NUA
Worksheet. Enter the result on line 6. Enter
the remainder of the federal estate tax on line
If you take the death benefit
exclusion and federal estate tax
was paid on the capital gain
amount, the capital gain amount
must be reduced by both the procedures
discussed above to figure the correct entry for
Multiple recipients, see Multiple recipients of a
lump-sum distribution, earlier.
Line 8. If Form 1099-R, box 2a, is blank, you
must first figure the taxable amount. For
details on how to do this, see Pub. 575.
If you made the 20% capital gain election,
enter only the ordinary income portion of the
distribution on this line. The ordinary income
portion is the amount from Form 1099-R, box
2a, minus the amount from box 3 of that form.
Add the amount from line F of the NUA
Worksheet if you included NUA capital gain in
the 20% capital gain election. On the dotted
line next to line 8, write “NUA” and the
amount from line F of the NUA Worksheet.
If you didn’t make the 20% capital gain
election and didn’t elect to include NUA in
taxable income, enter the amount from Form
1099-R, box 2a. If you didn’t make the 20%
capital gain election but did elect to include
NUA in your taxable income, add the amount
from Form 1099-R, box 2a, to the amount
from Form 1099-R, box 6. Enter the total on
line 8. On the dotted line next to line 8, write
“NUA” and the amount from Form 1099-R,
Community property laws don’t
apply in figuring tax on the amount
you report on line 8.
Line 9. If you received the distribution
because of the plan participant’s death and
the participant died before August 21, 1996,
you may be able to exclude up to $5,000 of
the lump sum from your gross income. This
exclusion applies to the beneficiaries or
estates of common-law employees, self-
employed individuals, and shareholder-
employees who owned more than 2% of the
stock of an S corporation.
Enter the allowable death benefit exclusion
on line 9. If you made the 20% capital gain
election, enter the amount from line D of the
Death Benefit Worksheet minus the amount
from line E of that worksheet.
Multiple recipients. If there are multiple
recipients of the distribution not all of whom
are trusts, and you didn’t complete Part II,
enter the full allowable death benefit exclusion
on line 9. Don’t allocate the exclusion among
the recipients; the computation under Multiple
recipients of a lump-sum distribution, earlier,
effectively allocates the exclusion.
If you completed Part II, multiply the full
allowable death benefit exclusion (don’t
allocate among the recipients) by the
percentage on line C of the Death Benefit
Worksheet. Subtract the result from the full
allowable death benefit exclusion. Enter the
result on line 9.
Line 18. A beneficiary who receives a lump-
sum distribution because of a plan
participant’s death must reduce the taxable
part of the distribution by any federal estate
tax paid on the lump-sum distribution (get this
amount from the administrator of the
deceased’s estate). Do this by entering on line
18 the federal estate tax attributable to the
lump-sum distribution. Also, see Line 6 above
if you made a capital gain election.
Lines 24 and 27. Use the following Tax Rate
Schedule to complete lines 24 and 27.
Line 29. Multiple recipients, see Multiple
recipients of a lump-sum distribution, earlier.
Tax Rate Schedule
If the amount on
line 23 or 26 is:
Enter on line
24 or 27:
$ 0 $ 1,190 - - - - - 11% $ 0
1,190 2,270 $130.90 + 12% 1,190
2,270 4,530 260.50 + 14% 2,270
4,530 6,690 576.90 + 15% 4,530
6,690 9,170 900.90 + 16% 6,690
9,170 11,440 1,297.70 + 18% 9,170
11,440 13,710 1,706.30 + 20% 11,440
13,710 17,160 2,160.30 + 23% 13,710
17,160 22,880 2,953.80 + 26% 17,160
22,880 28,600 4,441.00 + 30% 22,880
28,600 34,320 6,157.00 + 34% 28,600
34,320 42,300 8,101.80 + 38% 34,320
42,300 57,190 11,134.20 + 42% 42,300
57,190 85,790 17,388.00 + 48% 57,190
- - - - -
31,116.00 + 50% 85,790
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