How to Read a CSA 1099-R: Boxes, Codes, and Taxable Amount

Your CSA 1099-R is the tax form the Office of Personnel Management sends every federal retiree, and reading it comes down to five boxes: Box 1 (what OPM paid you), Box 2a (what’s taxable), Box 4 (federal tax already withheld), Box 5 (the tax-free piece and insurance premiums), and Box 7 (a code describing the type of payment). The “CSA” prefix on your claim number means you’re the retiree; a “CSF” prefix means you’re receiving a survivor annuity on someone else’s record.¹ OPM posts the form to Retirement Services Online in the third week of January and mails paper copies by January 31.²

Box 1: Gross Distribution

Box 1 is the total OPM paid out on your account during the calendar year. It includes both the taxable and non-taxable portions of your annuity. It also includes amounts OPM deducted on your behalf, such as health insurance premiums or court-ordered payments, because the IRS treats those as money paid to you even though it never hit your bank account.

Box 2a: Taxable Amount

Box 2a is the figure you actually report as taxable pension income on Form 1040. It is Box 1 minus the tax-free recovery of the contributions you made to CSRS or FERS during your career (your cost basis). For most retirees, OPM calculates this amount using the rules in IRS Publication 721.³

Sometimes Box 2a says “Unknown,” or the “Taxable amount not determined” box is checked. That means OPM could not compute the tax-free portion for you. It happens most often in your first year of retirement, when cost-basis records are incomplete, when you chose an alternative form of annuity, or when you retired on disability.² When that happens you have to run the Simplified Method yourself. The calculation is below.

Box 4: Federal Income Tax Withheld

Box 4 is the federal income tax OPM pulled from your monthly payments and sent to the IRS during the year. It is credited against your total tax bill when you file, exactly like paycheck withholding. If you never chose a withholding rate, OPM defaults to single with no adjustments, which tends to withhold more than married filers actually owe.²

Box 5: Employee Contributions and Insurance Premiums

Box 5 bundles two different things: the share of your own CSRS or FERS contributions recovered tax-free during the year, and any after-tax health or accident insurance premiums deducted from your annuity. The recovered-contribution piece is the non-taxable slice that produces Box 2a. OPM breaks down what went into Box 5 in the explanatory notes mailed with the form.²

Box 7: Distribution Code

Box 7 holds a one-character code describing what kind of payment you got. For a typical retiree, you’ll see Code 7, meaning a normal distribution to someone 59½ or older. A surviving spouse or beneficiary receiving a death benefit sees Code 4. A federal employee who retired on disability before minimum retirement age sees Code 3, which has its own reporting rule described below.⁴

Calculating the Taxable Amount Yourself

Every dollar you paid into CSRS or FERS during your career was already taxed through payroll. That total is your cost basis, and the IRS lets you recover it tax-free by spreading it across a fixed number of monthly payments. The method is called the Simplified Method, and it is required for anyone whose annuity started after November 18, 1996.⁵

Divide your total cost basis by the number of anticipated payments from the IRS table. The result is your monthly tax-free exclusion. Multiply that by the number of months you received payments during the tax year, subtract from your Box 1 gross distribution, and the remainder is the taxable amount that belongs in Box 2a.³

Single-Life Annuity Divisors

If your annuity has no survivor benefit, or it started before 1998, pick the divisor based on your age when the annuity started:

55 or under: 360 months
56 to 60: 310 months
61 to 65: 260 months
66 to 70: 210 months
71 or older: 160 months

Joint and Survivor Annuity Divisors

If your annuity started after 1997 and includes a survivor benefit for your spouse, use the combined-age table:³

Combined ages 110 or under: 410 months
111 to 120: 360 months
121 to 130: 310 months
131 to 140: 260 months
141 or older: 210 months

A worked example: you retired at 62 with a $52,000 cost basis and no survivor benefit, so the divisor is 260. Monthly tax-free exclusion is $200. Over a full year, $2,400 of your annuity is tax-free. If Box 1 shows $36,000, then $33,600 is taxable. Worksheet A in Publication 721 walks through this line by line.³

When the Tax-Free Portion Runs Out

The monthly exclusion stops once you have recovered your entire cost basis. In the $52,000 example at $200 a month, that takes 260 months. After that, every dollar of your annuity is taxable as ordinary income, and the number in Box 2a will equal the number in Box 1.

If a retiree dies before recovering the full cost basis, the unrecovered balance is not lost. It can be claimed as a deduction on the final income tax return, and the IRS allows the deduction to be treated as a net operating loss that can offset other income on that return.⁶ It is a commonly missed break, so whoever prepares the final return should pull the annuity records and check.

If You See Code 3: Disability Retirement

Disability retirees under CSRS or FERS get different treatment until they reach minimum retirement age. During that stretch, annuity payments are taxed as wages rather than pension income.⁷ Report them on the wages line of Form 1040 (line 1h), not on the pension and annuity lines.⁸ Box 7 shows Code 3 during this period, and Box 2a is often marked “Unknown,” so you compute the taxable amount yourself. Once you reach minimum retirement age, the payments shift to pension treatment and you use the Simplified Method like any other retiree.

If Your Form Says CSF: Survivor Annuities

When a federal retiree dies and a spouse or other beneficiary begins drawing a survivor annuity, OPM issues a separate 1099-R with a CSF claim number instead of CSA, and Box 7 shows Code 4. The survivor continues recovering the deceased retiree’s unrecovered cost basis using the same exclusion that applied to the original retiree, and keeps taking it each year until the cost basis is fully recovered.⁹ For annuities that started after 1986, the total amount the survivor can exclude is capped at the original net cost.³

A Tax Break the Form Won’t Apply for You

Retired law enforcement officers, firefighters, chaplains, and members of a rescue squad or ambulance crew can exclude up to $3,000 a year from taxable annuity income to pay for health or long-term care insurance covering themselves, a spouse, or dependents.⁵ The distribution has to come from the governmental retirement plan of the employer you retired from.

Nothing on your 1099-R reflects this exclusion. You claim it yourself by writing “PSO” next to line 5b of Form 1040 and reducing the taxable amount by the lesser of $3,000 or the premiums you actually paid. You cannot also deduct those premiums as a medical expense.

Getting a Duplicate or Fixing a Wrong Form

Lost your 1099-R? The fastest route is Retirement Services Online, where you can view and print current and prior-year forms right away.¹⁰ Without internet access, call OPM’s Retirement Information Center at 1-888-767-6738 and request a paper copy.

If the numbers on the form look wrong, send OPM a written request identifying the error with supporting documentation. If OPM agrees, it issues a corrected 1099-R to use in place of the original. When OPM does not produce a corrected form in time to file, call the IRS at 800-829-1040. The IRS will contact OPM and send you Form 4852, a substitute you fill in with your best estimate of the correct figures and attach to your return.¹¹ If the corrected form arrives later and the numbers differ from your estimate, file an amended return on Form 1040-X.

1
U.S. Office of Personnel Management. Get Your 1099-R Tax Form
2
U.S. Office of Personnel Management. Tax Information for Annuitants
3
Internal Revenue Service. Publication 721, Tax Guide to U.S. Civil Service Retirement Benefits
4
Internal Revenue Service. 2025 Instructions for Forms 1099-R and 5498
5
Internal Revenue Service. Publication 575, Pension and Annuity Income
6
Office of the Law Revision Counsel. 26 USC 72 – Annuities; Certain Proceeds of Endowment and Life Insurance Contracts
7
U.S. Office of Personnel Management. FAQs About Taxes and Federal Retirement
8
Internal Revenue Service. Publication 907, Tax Highlights for Persons With Disabilities
9
Internal Revenue Service. Publication 939, General Rule for Pensions and Annuities
10
U.S. Office of Personnel Management. Request Your 1099-R by Email
11
Internal Revenue Service. What to Do When a W-2 or Form 1099 Is Missing or Incorrect