1099-R • 1096 • 945
1099-R Worksheet Instructions (Calendar Year 2025)
Use this guide to complete the Schedule of Participant Benefit Payments so we can prepare required IRS forms
accurately and on time (including rollovers, lump sums, PS 58, and defaulted loans).
Deadline reminder: Please return the completed worksheet by Tuesday, January 13, 2026.
You may return it via fax (305) 274-1882 or email ps@pensionnetwork.net.
You may return it via fax (305) 274-1882 or email ps@pensionnetwork.net.
Overview
The worksheet is used to report benefit payments made in 2025 so we can generate IRS Forms
1099-R, 1096, and 945 (if applicable).
What to include: terminated participant distributions, PS 58 life insurance costs, and
participant loans that defaulted during 2025.
participant loans that defaulted during 2025.
Column (1): Participant information
1
Name + SSN (match Social Security card)
Enter the participant’s legal name and SSN exactly as shown on the Social Security card.
2
Mailing address
Enter the complete mailing address for tax reporting delivery.
Column (2): Taxable vs non-taxable
Most benefit payments fall into one of two categories:
- Non-taxable (typically paid as one check)
- Taxable (often two checks: one to IRS for withholding + one to participant)
Important: PS 58 costs and defaulted loans are usually reported as a single taxable amount
with no withholding.
with no withholding.
Columns (3), (4), and (5): Amounts, dates, check/wire numbers
A
If the participant elected a Direct Rollover
- Enter the amount next to TO ROLLOVER in column (3).
- Enter the check/wire date in column (4).
- Enter the check number or wire tracking number in column (5).
B
If the participant elected a Lump Sum
- Enter amount paid to participant next to TO PARTICIPANT in column (3).
- Enter date in column (4) and check/wire number in column (5).
- Enter taxes withheld next to TO IRS FOR TAX W/H in column (3).
- If an RMD was paid and no withholding occurred, the tax line may be 0.
- Enter IRS payment date + check/wire number (columns 4–5).
C
If the participant has reportable PS 58 costs
- Enter the PS 58 cost amount next to TO PARTICIPANT in column (3).
- Enter N/A in columns (4) and (5).
D
If a loan defaulted during 2025
- Enter the outstanding balance (including interest) next to TO PARTICIPANT in column (3).
- Enter the default date in column (4).
- Enter N/A in column (5).
Column (6): Distribution codes
Enter the distribution code(s). Codes include at least one number; some scenarios use a letter (example: 1L).
| Code | Description |
|---|---|
| 1 | Early distribution before age 59½ (if code 2 does not apply). |
| 2 | Early distribution before 59½ and (a) age 55+ and terminated, or (b) SEPP applies. |
| 3 | Disability. |
| 4 | Death. |
| 7 | Normal distribution (age 59½+), not rolled over. |
| 8 | Refund of excess deferrals or contributions. |
| 9 | Cost of current life insurance protection (PS 58 costs). |
| G | Direct rollover to qualified plan/403(b)/457(b)/IRA. |
| L | Loans treated as distributions. |
Common mistake: forgetting to report a direct rollover. If funds moved directly to an IRA/plan,
it still must be reported (use code G).
it still must be reported (use code G).
Examples
Example #1: Joe (age 40) hardship distribution → Code 1.
Example #2: Sally (age 57) terminated and distributed 100% → Code 2.
Example #3: Bob (age 65) rollover to IRA → Code G.
Example #4: Tina (age 68) no rollover → Code 7.
Example #5: Tom (age 32) defaulted loan → Code 1L.
Example #6: Gina (age 42) ADP refund → Code 8.
Frequently Asked Questions
Why do I need to complete the worksheet even if I think it doesn’t apply?General
Completing the worksheet confirms whether any reportable transactions occurred. Even “none to report” should be confirmed to help avoid missing IRS reporting and prevent delays.
Why did I receive this if I have a recordkeeper (John Hancock, Empower, etc.)?Recordkeeper
Our records indicate your plan may have assets or distribution activity outside the primary recordkeeper. As your TPA, we still must ensure any required 1099-R forms are prepared and filed on time for distributions from outside accounts.
If an outside provider issues the 1099-R directly, we still need confirmation so we can reconcile reporting and records.
Why did I receive two emails at the same time?Multiple plans
This usually means your organization sponsors more than one plan (for example, a 401(k) and a Cash Balance/Defined Benefit plan). Each plan has separate reporting requirements and needs its own response.
What is the deadline for submitting the completed worksheet?Deadlines
Please submit the worksheet by Tuesday, January 19, 2026. This allows enough time to prepare participant copies by the IRS deadline of January 31, 2026.
Should I include distributions that were rolled over directly to an IRA or another plan?Codes
Yes. Direct rollovers must be reported. Use distribution code G for direct rollovers.
How do I report a participant who did both a rollover and a lump sum?Worksheet
Enter separate rows/entries so each payment type is clear, with the correct amounts, dates, and codes.
What if no taxes were withheld?Withholding
Enter 0 next to TO IRS FOR TAX W/H so it’s clear no withholding was sent.
How do I handle a deceased participant?Codes
Use distribution code 4. Where applicable, beneficiary details may be needed for proper tax reporting.
What is PS 58 cost, and why is it reported on a 1099-R?PS 58
PS 58 is the taxable value of life insurance protection provided through the plan. The IRS requires reporting this value as taxable income to the participant, even if no cash was paid out.
Where can I find the PS 58 cost for my plan?PS 58
The life insurance carrier typically provides PS 58 cost information in a year-end statement/letter. If you haven’t received it, contact the carrier or your insurance agent.
How do I report a defaulted participant loan?Loans
Report the outstanding balance (including interest) and use the appropriate code (commonly 1L, depending on circumstances).
Can I get help if I’m unsure how to complete a section?Help
Yes. Call (305) 595-5500 ext. 235 or email participant.services01@pensionnetwork.net.