Tax Reporting for Calendar Year 2021
Dear Army NAF Pensioner:
This letter is to inform you that your tax reporting document for 2021 (1099R or 1042S) will reflect 13 months of pension payments for the 2021 tax year. This will happen only this year - going forward, you will receive 12 monthly annuity payments each calendar year. Do not be alarmed, you were not overpaid in 2021 or underpaid for any other year.
Your monthly annuity is traditionally paid and received at the end of each month for the following month. For example, pensioners are paid and receive their May benefit during the last few days of April. However, in January 2021, we waited until early January to pay the January benefit. Some pensioners immediately expressed concern, as the January payment was received several days later than most pensioners anticipated. After receiving feedback from pensioners, we quickly returned to making monthly payments prior to the first of each month. In subsequent months throughout the year, pensioners were paid and received payments at the end of each month for the following month's benefit, as usual.
We considered two options at the end of this year. The first option was to delay the payment until early January in order to avoid making 13 payments in 2021. The second option was to pay the January benefit at the end of December, as we typically do. We are choosing to pay the January benefit at the end of December, as we typically do.
This results in 13 payments during 2021. But it will ensure you receive your January payment before the beginning of January, as many indicated you prefer or even rely on. Delaying payments until January 1, 2022 would delay your receipt until as late as January 5th and cause frustration and hardship for some. We are hopeful that this will prevent some of the concern expressed by pensioners in January 2021, when payment was received later than most of you anticipated.
I appreciate your understanding in this matter, and wish you a joyous holiday season.
Paul D. Burk