§72. Annuities; certain proceeds of endowment and life insurance contracts — Inbound Citations
26 U.S.C. § 72
Cited by 134 provisions in release 119-102.
Citations to 26 U.S.C. § 72 as a whole
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(i) insuring, guaranteeing, or indemnifying against loss, harm, damage, illness, disability, or death (except to the extent permitted under section 302 or 303(c) of the Gramm-Leach-Bliley Act [15 U.S.C. 6712 or 6713(c)]) or providing or issuing annuities the income of which is subject to tax treatment under section 72 of title 26;
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(C) any liability of an insured depository institution that arises under an annuity contract, the income of which is tax deferred under section 72 of title 26.
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(3) the product is not title insurance, or an annuity contract the income of which is subject to tax treatment under section 72 of title 26.
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(3) any annuity contract, the income on which is subject to tax treatment under section 72 of title 26.
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(iii) For purposes of this subparagraph, the term “disability income” means the aggregate amount includable in the gross income of the individual for the taxable year under section 72 or 105(a) to the extent such amount constitutes wages (or payments in lieu of wages) for the period during which the individual is absent from work on account of permanent and total disability.
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(f) Notwithstanding any other provision of law, a qualified retirement savings contribution shall not fail to be included in determining the investment in the contract for purposes of section 72 by reason of the credit under this section.
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(C) Such term shall include any contribution to a qualified tuition program (as defined in section 529) on behalf of a designated beneficiary (as defined in such section), or to a Coverdell education savings account (as defined in section 530) on behalf of an account beneficiary, who is an individual described in subparagraph (A); but there shall be no increase in the investment in the contract for purposes of applying section 72 by reason of any portion of such contribution which is not includible in gross income by reason of this subparagraph.
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(a) Except as otherwise provided in this section, any amount actually distributed to any distributee by any employees’ trust described in section 401(a) which is exempt from tax under section 501(a) shall be taxable to the distributee, in the taxable year of the distributee in which distributed, under section 72 (relating to annuities).
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(2) The amount actually distributed or made available to any distributee by any trust described in paragraph (1) shall be taxable to the distributee, in the taxable year in which so distributed or made available, under section 72 (relating to annuities), except that distributions of income of such trust before the annuity starting date (as defined in section 72(c)(4)) shall be included in the gross income of the employee without regard to section 72(e)(5) (relating to amounts not received as annuities).
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(A) For purposes of subsection (a) and section 72, an alternate payee who is the spouse or former spouse of the participant shall be treated as the distributee of any distribution or payment made to the alternate payee under a qualified domestic relations order (as defined in section 414(p)).
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(A) For purposes of subsection (a) and section 72, in the case of a distribution other than a lump sum distribution, the amount actually distributed to any distributee from a trust described in subsection (a) shall not include any net unrealized appreciation in securities of the employer corporation attributable to amounts contributed by the employee (other than deductible employee contributions within the meaning of section 72(o)(5)). This subparagraph shall not apply to a distribution to which subsection (c) applies.
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(B) For purposes of subsection (a) and section 72, in the case of any lump sum distribution which includes securities of the employer corporation, there shall be excluded from gross income the net unrealized appreciation attributable to that part of the distribution which consists of securities of the employer corporation. In accordance with rules prescribed by the Secretary, a taxpayer may elect, on the return of tax on which a lump sum distribution is required to be included, not to have this subparagraph apply to such distribution.
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(6) For purposes of applying section 72, any amount includible in gross income for any taxable year under this subsection but which is not distributed from the plan during such taxable year shall not be treated as investment in the contract.
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(B) Notwithstanding section 72, in determining the extent to which an amount is treated as a distribution for purposes of subparagraph (A), the aggregate amounts distributed from an eligible retirement plan in a taxable year (up to the amount excluded under paragraph (1)) shall be treated as includible in gross income (without regard to subparagraph (A)) to the extent that such amount does not exceed the aggregate amount which would have been so includible if all amounts to the credit of the eligible public safety officer in all eligible retirement plans maintained by the employer described in paragraph (4)(B) were distributed during such taxable year and all such plans were treated as 1 contract for purposes of determining under section 72 the aggregate amount which would have been so includible. Proper adjustments shall be made in applying section 72 to other distributions in such taxable year and subsequent taxable years.
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(3) Notwithstanding section 72, if any excess deferral under section 402(g)(2) attributable to a designated Roth contribution is not distributed on or before the 1st April 15 following the close of the taxable year in which such excess deferral is made, the amount of such excess deferral shall—(A) not be treated as investment in the contract, and(B) be included in gross income for the taxable year in which such excess is distributed.
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(4) Section 72 shall be applied separately with respect to distributions and payments from a designated Roth account and other distributions and payments from the plan.
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(1) If an annuity contract is purchased by an employer for an employee under a plan which meets the requirements of section 404(a)(2) (whether or not the employer deducts the amounts paid for the contract under such section), the amount actually distributed to any distributee under the contract shall be taxable to the distributee (in the year in which so distributed) under section 72 (relating to annuities).
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(1) If—(A) an annuity contract is purchased—(i) for an employee by an employer described in section 501(c)(3) which is exempt from tax under section 501(a),(ii) for an employee (other than an employee described in clause (i)), who performs services for an educational organization described in section 170(b)(1) (A)(ii), by an employer which is a State, a political subdivision of a State, or an agency or instrumentality of any one or more of the foregoing, or(iii) for the minister described in section 414(e)(5)(A) by the minister or by an employer,(B) such annuity contract is not subject to subsection (a),(C) the employee’s rights under the contract are nonforfeitable, except for failure to pay future premiums,(D) except in the case of a contract purchased by a church, such contract is purchased under a plan which meets the nondiscrimination requirements of paragraph (12), and(E) in the case of a contract purchased under a salary reduction agreement, the contract meets the requirements of section 401(a)(30),then contributions and other additions by such employer for such annuity contract shall be excluded from the gross income of the employee for the taxable year to the extent that the aggregate of such contributions and additions (when expressed as an annual addition (within the meaning of section 415(c)(2))) does not exceed the applicable limit under section 415. The amount actually distributed to any distributee under such contract shall be taxable to the distributee (in the year in which so distributed) under section 72 (relating to annuities). For purposes of applying the rules of this subsection to contributions and other additions by an employer for a taxable year, amounts transferred to a contract described in this paragraph by reason of a rollover contribution described in paragraph (8) of this subsection or section 408(d)(3)(A)(ii) shall not be considered contributed by such employer.
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(c) Premiums paid by an employer for an annuity contract which is not subject to subsection (a) shall be included in the gross income of the employee in accordance with section 83 (relating to property transferred in connection with performance of services), except that the value of such contract shall be substituted for the fair market value of the property for purposes of applying such section. The preceding sentence shall not apply to that portion of the premiums paid which is excluded from gross income under subsection (b). In the case of any portion of any contract which is attributable to premiums to which this subsection applies, the amount actually paid or made available under such contract to any beneficiary which is attributable to such premiums shall be taxable to the beneficiary (in the year in which so paid or made available) under section 72 (relating to annuities).
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(2) For purposes of applying section 72 to any amount described in paragraph (1)—(A) all individual retirement plans shall be treated as 1 contract,(B) all distributions during any taxable year shall be treated as 1 distribution, and(C) the value of the contract, income on the contract, and investment in the contract shall be computed as of the close of the calendar year in which the taxable year begins.For purposes of subparagraph (C), the value of the contract shall be increased by the amount of any distributions during the calendar year.
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(I) section 72 shall be applied separately to such distribution,
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(II) notwithstanding the pro rata allocation of income on, and investment in, the contract to distributions under section 72, the portion of such distribution rolled over to an eligible retirement plan described in clause (i) shall be treated as from income on the contract (to the extent of the aggregate income on the contract from all individual retirement plans of the distributee), and
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(III) appropriate adjustments shall be made in applying section 72 to other distributions in such taxable year and subsequent taxable years.
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(D) Notwithstanding section 72, in determining the extent to which a distribution is a qualified charitable distribution, the entire amount of the distribution shall be treated as includible in gross income without regard to subparagraph (A) to the extent that such amount does not exceed the aggregate amount which would have been so includible if all amounts in all individual retirement plans of the individual were distributed during such taxable year and all such plans were treated as 1 contract for purposes of determining under section 72 the aggregate amount which would have been so includible. Proper adjustments shall be made in applying section 72 to other distributions in such taxable year and subsequent taxable years.
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(E) Notwithstanding section 72, in determining the extent to which an amount is treated as otherwise includible in gross income for purposes of subparagraph (A), the aggregate amount distributed from an individual retirement plan shall be treated as includible in gross income to the extent that such amount does not exceed the aggregate amount which would have been so includible if all amounts from all individual retirement plans were distributed. Proper adjustments shall be made in applying section 72 to other distributions in such taxable year and subsequent taxable years.
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(B) For purposes of applying this section and section 72 to any distribution from a Roth IRA, such distribution shall be treated as made—(i) from contributions to the extent that the amount of such distribution, when added to all previous distributions from the Roth IRA, does not exceed the aggregate contributions to the Roth IRA; and(ii) from such contributions in the following order:(I) Contributions other than qualified rollover contributions to which paragraph (3) applies.(II) Qualified rollover contributions to which paragraph (3) applies on a first-in, first-out basis.Any distribution allocated to a qualified rollover contribution under clause (ii)(II) shall be allocated first to the portion of such contribution required to be included in gross income.
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(C) For purposes of applying section 72 in the case of a distribution which is not a qualified distribution, the amount treated as a rollover by reason of subparagraph (A) shall be treated as investment in the contract.
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(B) the tax treatment of any amount made available under the plan to a participant or beneficiary shall be determined under section 72 (relating to annuities, etc.).
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(A) Any distribution under a qualified tuition program shall be includible in the gross income of the distributee in the manner as provided under section 72 to the extent not excluded from gross income under any other provision of this chapter.
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(A) Any distribution under a qualified ABLE program shall be includible in the gross income of the distributee in the manner as provided under section 72 to the extent not excluded from gross income under any other provision of this chapter.
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(B) Such term shall include any contribution to a qualified tuition program (as defined in section 529(b)) on behalf of the designated beneficiary (as defined in section 529(e)(1)); but there shall be no increase in the investment in the contract for purposes of applying section 72 by reason of any portion of such contribution which is not includible in gross income by reason of subsection (d)(2).
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(C) For purposes of applying section 72 in the case of a distribution which is includible in gross income under paragraph (1), the amount treated as a rollover by reason of subparagraph (A) shall be treated as investment in the contract.
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(2) For purposes of applying section 72 to any amount distributed from a Trump account, the investment in the contract shall not include—(A) any qualified general contribution,(B) any contribution provided under section 6434, and(C) the amount of any contribution which is excluded from gross income under section 128.
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(1) For purposes of computing the deduction under subsection (c)(1)(A), amounts received by a surviving annuitant—(A) as an annuity under a joint and survivor annuity contract where the decedent annuitant died after the annuity starting date (as defined in section 72(c)(4)), and(B) during the surviving annuitant’s life expectancy period,shall, to the extent included in gross income under section 72, be considered as amounts included in gross income under subsection (a).
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(A) by determining the excess of the value of the annuity at the date of the death of the deceased annuitant over the total amount excludable from the gross income of the surviving annuitant under section 72 during the surviving annuitant’s life expectancy period, and
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(1) For purposes of subchapter L, section 72 (relating to annuities), and section 7702(a) (relating to definition of life insurance contract), a variable contract (other than a pension plan contract) which is otherwise described in this section and which is based on a segregated asset account shall not be treated as an annuity, endowment, or life insurance contract for any period (and any subsequent period) for which the investments made by such account are not, in accordance with regulations prescribed by the Secretary, adequately diversified.
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(1) to provide for the treatment of market value adjustments under sections 72, 7702, 7702A, and 807(e)(1)(B),
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(A) annuities described in section 72;
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(B) The term “debt instrument” shall not include any annuity contract to which section 72 applies and which—(i) depends (in whole or in substantial part) on the life expectancy of 1 or more individuals, or(ii) is issued by an insurance company subject to tax under subchapter L (or by an entity described in section 501(c) and exempt from tax under section 501(a) which would be subject to tax under subchapter L were it not so exempt)—(I) in a transaction in which there is no consideration other than cash or another annuity contract meeting the requirements of this clause,(II) pursuant to the exercise of an election under an insurance contract by a beneficiary thereof on the death of the insured party under such contract, or(III) in a transaction involving a qualified pension or employee benefit plan.
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(1) If the applicable requirements of sections 72, 104(a)(1), 104(a)(2), 130, and 461(h) were satisfied at the time the structured settlement involving structured settlement payment rights was entered into, the subsequent occurrence of a structured settlement factoring transaction shall not affect the application of the provisions of such sections to the parties to the structured settlement (including an assignee under a qualified assignment under section 130) in any taxable year.
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(2) such distribution is made following a rollover, transfer, or exchange described in section 72(t)(4)(C) or section 72(q)(3)(C),
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(B) If—(i) a change described in subparagraph (A) reduces benefits under the contract,(ii) the change occurs during the 15-year period beginning on the issue date of the contract, and(iii) a cash distribution is made to the policyholder as a result of such change,section 72 (other than subsection (e)(5) thereof) shall apply to such cash distribution to the extent it does not exceed the recapture ceiling determined under subparagraph (C) or (D) (whichever applies).
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(a) For purposes of section 72, the term “modified endowment contract” means any contract meeting the requirements of section 7702—(1) which—(A) is entered into on or after June 21, 1988, and(B) fails to meet the 7-pay test of subsection (b), or(2) which is received in exchange for a contract described in paragraph (1) or this paragraph.
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(A) stock transferred under paragraph (2) and allocated to the account of any participant under paragraph (2) shall not be considered income of the participant or his beneficiary under title 26 until such stock or dividends are actually distributed or made available to the participant or his beneficiary and, at such time, shall be taxable under section 72 of title 26 (treating the participant or his beneficiary as having a basis of 0 in the stock);
Citations to §72(b)(3)
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(10) the deduction under section 72(b)(3) (relating to deduction where annuity payments cease before investment recovered),
Citations to §72(c)
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(II) Qualified charitable distributions made to fund a charitable gift annuity shall not be treated as an investment in the contract for purposes of section 72(c).
Citations to §72(c)(4)
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(2) The amount actually distributed or made available to any distributee by any trust described in paragraph (1) shall be taxable to the distributee, in the taxable year in which so distributed or made available, under section 72 (relating to annuities), except that distributions of income of such trust before the annuity starting date (as defined in section 72(c)(4)) shall be included in the gross income of the employee without regard to section 72(e)(5) (relating to amounts not received as annuities).
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(A) as an annuity under a joint and survivor annuity contract where the decedent annuitant died after the annuity starting date (as defined in section 72(c)(4)), and
Citations to §72(d)
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(2) for purposes of sections 72(d) (relating to treatment of employee contributions as separate contract), 411(a)(7)(A) (relating to minimum vesting standards), 415 (relating to limitations on benefits and contributions under qualified plans), and 401(m) (relating to nondiscrimination tests for matching requirements and employee contributions), be treated as consisting of a defined contribution plan to the extent benefits are based on the separate account of a participant and as a defined benefit plan with respect to the remaining portion of benefits under the plan, and
Citations to §72(e)
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(B) The term “premiums paid” means the premiums paid under the contract less any amounts (other than amounts includible in gross income) to which section 72(e) applies. If, in order to comply with the requirements of paragraph (1)(A), any portion of any premium paid during any contract year is returned by the insurance company (with interest) within 60 days after the end of a contract year—(i) the amount so returned (excluding interest) shall be deemed to reduce the sum of the premiums paid under the contract during such year, and(ii) notwithstanding the provisions of section 72(e), the amount of any interest so returned shall be includible in the gross income of the recipient.
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(ii) notwithstanding the provisions of section 72(e), the amount of any interest so returned shall be includible in the gross income of the recipient.
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(II) distributions (other than amounts includible in the policyholder’s gross income) during such taxable year to which section 72(e) applies.
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(B) the sum of the distributions out of the account (for all prior taxable years) which are included in gross income under section 72(e).
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(A) The term “premiums paid” means the premiums paid under the contract less amounts (other than amounts includible in gross income) to which section 72(e) applies and less any excess premiums with respect to which there is a distribution described in subparagraph (B) or (E) of paragraph (7) and any other amounts received with respect to the contract which are specified in regulations.
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(C) Notwithstanding the provisions of section 72(e), the amount of any interest returned as provided in subparagraph (B) shall be includible in the gross income of the recipient.
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(ii) amounts to which section 72(e) applies (determined without regard to paragraph (4)(A) thereof) but not including amounts includible in gross income.
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(C) Notwithstanding the provisions of section 72(e), the amount of any interest returned as provided in subparagraph (B) shall be includible in the gross income of the recipient.
Citations to §72(e)(5)
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(2) The amount actually distributed or made available to any distributee by any trust described in paragraph (1) shall be taxable to the distributee, in the taxable year in which so distributed or made available, under section 72 (relating to annuities), except that distributions of income of such trust before the annuity starting date (as defined in section 72(c)(4)) shall be included in the gross income of the employee without regard to section 72(e)(5) (relating to amounts not received as annuities).
Citations to §72(e)(6)
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(B) the investment in the contract (as defined in section 72(e)(6)) with respect to such seller, and
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(E) such person’s estimate of the investment in the contract (as defined in section 72(e)(6)) with respect to the buyer.
Citations to §72(e)(11)
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(a) Any person who makes a charge against the cash value of an annuity contract, or the cash surrender value of a life insurance contract, which is excludible from gross income under section 72(e)(11) shall make a return, according to the forms or regulations prescribed by the Secretary, setting forth—(1) the amount of the aggregate of such charges against each such contract for the calendar year,(2) the amount of the reduction in the investment in each such contract by reason of such charges, and
Citations to §72(f)
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(1) Section 72(f) (relating to special rules for computing employees’ contributions).
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(1) Section 72(f) (relating to special rules for computing employees’ contributions).
Citations to §72(m)(3)
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(3) the cost of any group-term life insurance which is provided under a contract to which section 72(m)(3) applies.
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(f) Subsection (b)(3) and section 72(m)(3) shall not apply in the case of any cost paid (whether directly or indirectly) with assets held in an applicable life insurance account (as defined in section 420(e)(4)) under a defined benefit plan.
Citations to §72(m)(5)
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(iv) This paragraph shall not apply to amounts described in subparagraph (A) of section 72(m)(5) to the extent that section 72(m)(5) applies to such amounts.
Citations to §72(m)(5)(A)
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(iv) This paragraph shall not apply to amounts described in subparagraph (A) of section 72(m)(5) to the extent that section 72(m)(5) applies to such amounts.
Citations to §72(m)(5)(B)
Citations to §72(m)(7)
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(1) the cost of group-term life insurance on the life of an individual which is provided under a policy carried directly or indirectly by an employer after such individual has terminated his employment with such employer and is disabled (within the meaning of section 72(m)(7)),
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(i) becomes disabled within the meaning of section 72(m)(7), or
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(B) Subparagraph (A) shall not apply if the payment or distribution is made after the account holder becomes disabled within the meaning of section 72(m)(7) or dies.
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(ii) Subclauses (I) and (II) of clause (i) shall not apply if the individual ceased to be an eligible individual by reason of the death of the individual or the individual becoming disabled (within the meaning of section 72(m)(7)).
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(B) Subparagraph (A) shall not apply if the payment or distribution is made after the account beneficiary becomes disabled within the meaning of section 72(m)(7) or dies.
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(III) disabled (within the meaning of section 72(m)(7)),
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(IV) after the employee has become disabled (within the meaning of section 72(m)(7)),
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(IV) the employee becomes disabled (within the meaning of section 72(m)(7)),
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(A) when the employee attains age 59½, has a severance from employment, dies, or becomes disabled (within the meaning of section 72(m)(7)),
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(ii) Subclauses (I) and (II) of clause (i) shall not apply if the individual ceased to be an eligible individual by reason of the death of the individual or the individual becoming disabled (within the meaning of section 72(m)(7)).
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(iii) attributable to the individual’s being disabled (within the meaning of section 72(m)(7)), or
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(ii) receives contributions on the employee’s behalf after the employee’s separation from such service, but only for a period of 5 years after such separation, unless the employee is disabled (within the meaning of the disability provisions of the church plan or, if there are no such provisions in the church plan, within the meaning of section 72(m)(7)) at the time of such separation from service.
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(ii) attributable to the designated beneficiary’s being disabled (within the meaning of section 72(m)(7)),
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(C) the disability of the employee (within the meaning of section 72(m)(7)), or
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(II) receives contributions on the employee’s behalf after the employee’s separation from such service, but only for a period of 5 years after such separation, unless the employee is disabled (within the meaning of the disability provisions of the church plan or, if there are no such provisions in the church plan, within the meaning of section 72(m)(7) of title 26) at the time of such separation from service.
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(2) The trustee shall not recover any payment made from a plan after or on account of the death of a participant, or to a participant who is disabled (within the meaning of section 72(m)(7) of title 26).
Citations to §72(n)
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(2) For purposes of paragraph (1) and section 72(n), the term “consideration for the contract” means, in respect of any individual, the sum of—(A) the total amount of the reductions before January 1, 1966, in his retired or retainer pay by reason of an election under chapter 73 of title 10 of the United States Code, and(B) any amounts deposited at any time by him pursuant to section 1438 or 1452(d) of such title 10.
Citations to §72(o)(5)
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(A) For purposes of subsection (a) and section 72, in the case of a distribution other than a lump sum distribution, the amount actually distributed to any distributee from a trust described in subsection (a) shall not include any net unrealized appreciation in securities of the employer corporation attributable to amounts contributed by the employee (other than deductible employee contributions within the meaning of section 72(o)(5)). This subparagraph shall not apply to a distribution to which subsection (c) applies.
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(D) For purposes of this paragraph—(i) The term “lump-sum distribution” means the distribution or payment within one taxable year of the recipient of the balance to the credit of an employee which becomes payable to the recipient—(I) on account of the employee’s death,(II) after the employee attains age 59½,(III) on account of the employee’s separation from service, or(IV) after the employee has become disabled (within the meaning of section 72(m)(7)),from a trust which forms a part of a plan described in section 401(a) and which is exempt from tax under section 501 or from a plan described in section 403(a). Subclause (III) of this clause shall be applied only with respect to an individual who is an employee without regard to section 401(c)(1), and subclause (IV) shall be applied only with respect to an employee within the meaning of section 401(c)(1). For purposes of this clause, a distribution to two or more trusts shall be treated as a distribution to one recipient. For purposes of this paragraph, the balance to the credit of the employee does not include the accumulated deductible employee contributions under the plan (within the meaning of section 72(o)(5)).(ii) For purposes of determining the balance to the credit of an employee under clause (i)—(I) all trusts which are part of a plan shall be treated as a single trust, all pension plans maintained by the employer shall be treated as a single plan, all profit-sharing plans maintained by the employer shall be treated as a single plan, and all stock bonus plans maintained by the employer shall be treated as a single plan, and(II) trusts which are not qualified trusts under section 401(a) and annuity contracts which do not satisfy the requirements of section 404(a)(2) shall not be taken into account.(iii) The provisions of this paragraph shall be applied without regard to community property laws.(iv) This paragraph shall not apply to amounts described in subparagraph (A) of section 72(m)(5) to the extent that section 72(m)(5) applies to such amounts.(v) For purposes of this paragraph, the balance to the credit of an employee shall not include any amount payable to an alternate payee under a qualified domestic relations order (within the meaning of section 414(p)).(vi) For purposes of this paragraph, the balance to the credit of an employee under a defined contribution plan shall not include any amount transferred from such defined contribution plan to a qualified cost-of-living arrangement (within the meaning of section 415(k)(2)) under a defined benefit plan.(vii) If any distribution or payment of the balance to the credit of an employee would be treated as a lump-sum distribution, then, for purposes of this paragraph, the payment under a qualified domestic relations order (within the meaning of section 414(p)) of the balance to the credit of an alternate payee who is the spouse or former spouse of the employee shall be treated as a lump-sum distribution. For purposes of this clause, the balance to the credit of the alternate payee shall not include any amount payable to the employee.
Citations to §72(p)
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(4) If any plan suspends the obligation to repay any loan made to an employee from such plan for any part of any period during which such employee is performing service in the uniformed services (as defined in chapter 43 of title 38, United States Code), whether or not qualified military service, such suspension shall not be taken into account for purposes of section 72(p), 401(a), or 4975(d)(1).
Citations to §72(p)(1)
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(iv) This subparagraph shall not apply to any plan loan offset amount unless such plan loan offset amount relates to a loan to which section 72(p)(1) does not apply by reason of section 72(p)(2).
Citations to §72(p)(2)
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(iv) This subparagraph shall not apply to any plan loan offset amount unless such plan loan offset amount relates to a loan to which section 72(p)(1) does not apply by reason of section 72(p)(2).
Citations to §72(p)(4)
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(1) The term “qualified education loan” means any indebtedness incurred by the taxpayer solely to pay qualified higher education expenses—(A) which are incurred on behalf of the taxpayer, the taxpayer’s spouse, or any dependent of the taxpayer as of the time the indebtedness was incurred,(B) which are paid or incurred within a reasonable period of time before or after the indebtedness is incurred, and(C) which are attributable to education furnished during a period during which the recipient was an eligible student.Such term includes indebtedness used to refinance indebtedness which qualifies as a qualified education loan. The term “qualified education loan” shall not include any indebtedness owed to a person who is related (within the meaning of section 267(b) or 707(b)(1)) to the taxpayer or to any person by reason of a loan under any qualified employer plan (as defined in section 72(p)(4)) or under any contract referred to in section 72(p)(5).
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(v) For purposes of this subsection, the term “qualified employer plan” has the meaning given such term by section 72(p)(4).
Citations to §72(p)(4)(A)(i)
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(A) The term “qualified employer plan” has the meaning given such term by section 72(p)(4)(A)(i); except that such term shall also include an eligible deferred compensation plan (as defined in section 457(b)) of an eligible employer described in section 457(e)(1)(A).
Citations to §72(p)(5)
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(1) The term “qualified education loan” means any indebtedness incurred by the taxpayer solely to pay qualified higher education expenses—(A) which are incurred on behalf of the taxpayer, the taxpayer’s spouse, or any dependent of the taxpayer as of the time the indebtedness was incurred,(B) which are paid or incurred within a reasonable period of time before or after the indebtedness is incurred, and(C) which are attributable to education furnished during a period during which the recipient was an eligible student.Such term includes indebtedness used to refinance indebtedness which qualifies as a qualified education loan. The term “qualified education loan” shall not include any indebtedness owed to a person who is related (within the meaning of section 267(b) or 707(b)(1)) to the taxpayer or to any person by reason of a loan under any qualified employer plan (as defined in section 72(p)(4)) or under any contract referred to in section 72(p)(5).
Citations to §72(q)
Citations to §72(q)(3)(B)(iii)
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(3) in making such return or report the person relies upon a certification provided by the taxpayer that the distributions satisfy the requirements of section 72(t)(4)(C)(iii) or section 72(q)(3)(B)(iii), as applicable, and
Citations to §72(r)
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(2) the employee contributions which are treated as having been paid for purposes of section 72(r),
Citations to §72(s)
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(5) For purposes of this section and section 954, the determination of whether a contract issued by a controlled foreign corporation or a qualified business unit (within the meaning of section 989(a)) is a life insurance contract or an annuity contract shall be made without regard to sections 72(s), 101(f), 817(h), and 7702 if—(A) such contract is regulated as a life insurance or annuity contract by the corporation’s or unit’s home country, and(B) no policyholder, insured, annuitant, or beneficiary with respect to the contract is a United States person.
Citations to §72(s)(5)
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(1) any annuity contract described in section 72(s)(5), and
Citations to §72(t)
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(D) No tax shall be imposed under section 72(t) on any amount required to be distributed under this paragraph.
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(A) No tax shall be imposed under section 72(t) on any amount required to be distributed under paragraph (6).
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(C) In the case of a distribution to which subparagraph (A) applies—(i) except as provided in clause (ii), such distribution shall not be included in gross income, and(ii) any income on the excess deferral shall, for purposes of this chapter, be treated as earned and received in the taxable year in which such income is distributed.No tax shall be imposed under section 72(t) on any distribution described in the preceding sentence.
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(ii) section 72(t) shall not apply, and
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(A) Notwithstanding any other provision of this subsection or section 72(t), paragraph (1) and section 72(t)(1) shall apply to the transfer or distribution from a simplified employee pension of any contribution under a salary reduction arrangement described in subsection (k)(6) (or any income allocable thereto) before a determination as to whether the requirements of subsection (k)(6)(A)(iii) are met with respect to such contribution.
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(ii) section 72(t) shall not apply, and
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(i) If—(I) any portion of a distribution from a Roth IRA is properly allocable to a qualified rollover contribution described in this paragraph; and(II) such distribution is made within the 5-taxable year period beginning with the taxable year in which such contribution was made,then section 72(t) shall be applied as if such portion were includible in gross income.(ii) Clause (i) shall apply only to the extent of the amount of the qualified rollover contribution includible in gross income under subparagraph (A)(i).
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(B) no tax shall be imposed under section 72(t) with respect to the distribution, and
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(2) To the extent provided in section 72(t)(9), section 72(t) shall apply to any amount includible in gross income under this subsection.
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(6) The term “early distribution tax” means any increase in tax imposed under section 72(t), 220(f)(4), 223(f)(4), 409A(a)(1)(B), 529(c)(6), 529A(c)(3), or 530(d)(4).
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(i) section 402(a), 403(a)(1), 403(b)(1), 408(d)(1), or 457(a)(1), whichever is applicable, shall not apply to any distribution of such contribution, and section 72(t) shall not apply to the distribution of such contribution or any income attributable thereto, if such distribution is received not later than the day prescribed by law (including extensions of time) for filing the individual’s return for such taxable year, and
Citations to §72(t)(1)
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(A) Notwithstanding any other provision of this subsection or section 72(t), paragraph (1) and section 72(t)(1) shall apply to the transfer or distribution from a simplified employee pension of any contribution under a salary reduction arrangement described in subsection (k)(6) (or any income allocable thereto) before a determination as to whether the requirements of subsection (k)(6)(A)(iii) are met with respect to such contribution.
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(A) In the case of an applicable retirement savings vehicle to which contributions have been made under subsection (a)(2), and from which a specified early distribution has been made during the taxable year, if the aggregate amount of such contributions exceeds the account balance of such savings vehicle at the end of the such taxable year, the tax imposed by chapter 1 shall be increased by an amount equal to such excess (reduced by the amount by which the tax under such chapter was increased under section 72(t)(1) with respect to such distribution).
Citations to §72(t)(2)(F)
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(5) For purposes of this section, the term “qualified special purpose distribution” means any distribution to which subparagraph (F) of section 72(t)(2) applies.
Citations to §72(t)(2)(G)
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(i) no such amounts may be paid or made available to any distributee (unless such amount is a distribution to which section 72(t)(2)(G) applies) before—(I) the employee dies,(II) the employee attains age 59½,(III) the employee has a severance from employment,(IV) the employee becomes disabled (within the meaning of section 72(m)(7)),(V) subject to the provisions of paragraph (17), the employee encounters financial hardship,(VI) except as may be otherwise provided by regulations, with respect to amounts invested in a lifetime income investment (as defined in section 401(a)(38)(B)(ii)), the date that is 90 days prior to the date that such lifetime income investment may no longer be held as an investment option under the contract, or(VII) as provided for distributions to which section 401(a)(39) applies, and
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(C) for distributions to which section 72(t)(2)(G) applies,
Citations to §72(t)(2)(G)(iii)
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(V) in the case of a qualified reservist distribution (as defined in section 72(t)(2)(G)(iii)), the date on which a period referred to in subclause (III) of such section begins,
Citations to §72(t)(2)(G)(iii)(III)
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(V) in the case of a qualified reservist distribution (as defined in section 72(t)(2)(G)(iii)), the date on which a period referred to in subclause (III) of such section begins,
Citations to §72(t)(4)(C)
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(2) such distribution is made following a rollover, transfer, or exchange described in section 72(t)(4)(C) or section 72(q)(3)(C),
Citations to §72(t)(4)(C)(iii)
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(3) in making such return or report the person relies upon a certification provided by the taxpayer that the distributions satisfy the requirements of section 72(t)(4)(C)(iii) or section 72(q)(3)(B)(iii), as applicable, and
Citations to §72(t)(6)
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(B) except in the case of a rollover contribution described in subsection (d)(3)(G) or a rollover contribution otherwise described in subsection (d)(3) or in section 402(c), 403(a)(4), 403(b)(8), or 457(e)(16), which is made after the 2-year period described in section 72(t)(6), with respect to which the only contributions allowed are contributions under a qualified salary reduction arrangement.
Citations to §72(t)(6)(A)
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(G) In the case of any payment or distribution out of a simple retirement account (as defined in subsection (p)) to which section 72(t)(6)(A) applies, this paragraph shall not apply unless such payment or distribution is paid into another simple retirement account.
Citations to §72(t)(8)(F)
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(ii) the term “applicable period” has the meaning given such term under section 72(t)(8)(F).
Citations to §72(t)(9)
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(2) To the extent provided in section 72(t)(9), section 72(t) shall apply to any amount includible in gross income under this subsection.
Citations to §72(t)(11)
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(i) the terms “qualified disaster”, “qualified disaster area”, and “incident period” have the meaning given such terms under section 72(t)(11), and
Citations to §72(t)(11)(C)(ii)
Citations to §72(t)(11)(C)(iii)
Citations to §72(u)
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(2) any annuity contract to which section 72(u) applies.
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(B) Paragraph (1) shall not apply to any annuity contract to which section 72(u) applies.
Citations to §72(v)
Citations to §72(w)
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(4) For purposes of determining an individual’s basis in property transferred in connection with the performance of services, rules similar to the rules of section 72(w) shall apply.