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Lump-Sum Election You must include the taxable part of a lump-sum (retroac- tive) payment of benefits received in 2022 in your 2022 in- come, even if the payment includes benefits for an earlier year. Check the box on line 6c if you elect to use the lump-sum election method for your benefits. If any of your benefits are taxable for 2022 and they in- clude a lump-sum benefit payment that was for an earlier year, you may be able to to reduce the taxable amount with the lump-sum election. This type of lump-sum benefit payment shouldn’t be confused with the lump-sum death benefit that both the SSA and RRB pay to many of their bene- ficiaries. No part of the lump-sum death benefit is subject to tax. Generally, you use your 2022 income to figure the taxa- ble part of the total benefits received in 2022. However, you may be able to figure the taxable part of a lump-sum payment for an earlier year separately, using your income for the earlier year. You can elect this method if it lowers your taxable benefits. Under the lump-sum election method, you refigure the taxable part of all your benefits for the earlier year (includ- ing the lump-sum payment) using that year's income. Then, you subtract any taxable benefits for that year that you previously reported. The remainder is the taxable part of the lump-sum payment. Add it to the taxable part of your benefits for 2022 (figured without the lump-sum pay- ment for the earlier year). Because the earlier year's taxable benefits are in- cluded in your 2022 income, no adjustment is made to the earlier year's return. Don’t file an amended return for the earlier year. Will the lump-sum election method lower your taxa- ble benefits? To find out, take the following steps. 1. Complete Worksheet 1 in this publication. 2. Complete Worksheet 2 and Worksheet 3, as appro- priate. Use Worksheet 2 if your lump-sum payment was for a year after 1993. Use Worksheet 3 if it was for 1993 or an earlier year. Complete a separate Worksheet 2 or Worksheet 3 for each earlier year for which you received the lump-sum payment. 3. Complete Worksheet 4. 4. Compare the taxable benefits on line 19 of Worksheet 1 with the taxable benefits on line 21 of Worksheet 4. If the taxable benefits on Worksheet 4 are lower than the taxable benefits on Worksheet 1, you can elect to report the lower amount on your return. Making the election. If you elect to report your taxable benefits under the lump-sum election method, follow the TIP TIP CAUTION ! instructions at the bottom of Worksheet 4. Don’t attach the completed worksheets to your return. Keep them with your records. Once you elect this method of figuring the taxable part of a lump-sum payment, you can revoke your election only with the consent of the IRS. Lump-sum payment reported on Form SSA-1099 or RRB-1099. If you received a lump-sum payment in 2022 that includes benefits for one or more earlier years after 1983, it will be included in box 3 of either Form SSA-1099 or Form RRB-1099. That part of any lump-sum payment for years before 1984 isn’t taxed and won’t be shown on the form. The form will also show the year (or years) the payment is for. However, Form RRB-1099 will not show a breakdown by year (or years) of any lump-sum payment for years before 2017. You must contact the RRB for a breakdown by year for any amount shown in box 9. Example Jane Jackson is single. In 2021, she applied for social se- curity disability benefits but was told she was ineligible. She appealed the decision and won. In 2022, she re- ceived a lump-sum payment of $6,000, of which $2,000 was for 2021 and $4,000 was for 2022. Jane also re- ceived $5,000 in social security benefits in 2022, so her total benefits in 2022 were $11,000. Jane's other income for 2021 and 2022 is as follows. Income 2021 2022 Wages $20,000 $3,500 Interest income 2,000 2,500 Dividend income 1,000 1,500 Fully taxable pension

18,000 Total $23,000 $25,500 To see if the lump-sum election method results in lower taxable benefits, she completes Worksheets 1, 2, and 4 from this publication. She doesn’t need to complete Work- sheet 3 because her lump-sum payment was for years af- ter 1993. Jane completes Worksheet 1 to find the amount of her taxable benefits for 2022 under the regular method. She completes Worksheet 2 to find the taxable part of the lump-sum payment for 2021 under the lump-sum election method. She completes Worksheet 4 to decide if the lump-sum election method will lower her taxable benefits. After completing the worksheets, Jane compares the amounts from Worksheet 4, line 21; and Worksheet 1, line 19. Because the amount on Worksheet 4 is smaller, she chooses to use the lump-sum election method. To do this, she prints “LSE” to the left of Form 1040 or 1040-SR, line 6a. She then enters $11,000 on Form 1040 or 1040-SR, line 6a, and her taxable benefits of $2,500 on line 6b. Jane's filled-in worksheets (1, 2, and 4) follow. CAUTION ! Publication 915 (2022) Page 11