Rev. Rul. 65-130

Advice has been requested with respect to the use of identifying numbers by a State employees' retirement system which had been held to qualify as an employees' trust under section 401(a) of the Internal Revenue Code of 1954 and to be exempt from tax under section 501(a) of the Code. Distributions to beneficiaries are taxable under section 402(a) of the Code when made available upon death or other separation from service.

Since the retirement system qualifies as an employees' trust under section 401(a) of the Code and is exempt from taxation under section 501(a) of the Code, it is required, under the provisions of section 6033 of the Code and section 1.6033-1(a)(3) of the regulations, to file an annual return on Form 990-P, Return of Employees' Trust Exempt from Tax.

Section 1.6109-1(b)(1) of the regulations provides, in general, that every person required to make a return, statement, or other document for any period commencing after December 31, 1961, with respect to his liability or to matters relating or dealing with his liability, shall include his identifying number in any such return, statement or other document filed after September 30, 1962.

The identifying number prescribed for use by a person other than an individual is an employer identification number and, for this purpose, a trust is considered to be a person other than an individual.

Therefore, it is held that inasmuch as the employees' retirement system must file an annual return on Form 990-P, it is required to include its employer identification number in that return. See section 1.6109-1(b)(1)(ii), Example 3, of the regulations.

If the retirement system is an `employer' for Federal employment tax purposes and has been assigned an employer identification number to be used when filing Form 941, Employer's Quarterly Federal Tax Return, it should use this same number for Federal income tax purposes. In the event the retirement system does not have an employer identification number, it should apply for such number by filing a Form SS-4, Application for Employer Identification Number. The retirement system may not use, for Federal tax purposes, the identification number assigned to the State of which it is a part.

Further, the amounts which are distributed or made available to a beneficiary of the retirement system are taxable under section 402(a) of the Code. Under the provisions of section 6041 of the Code and section 1.6041-2(b) of the regulations, amounts which are distributed or made available to a beneficiary and to which section 402 applies, shall be reported on Form 1099, U.S. Information Return for Calendar Year, and transmittal Form 1096 U.S. Annual Information Return, to the extent such amounts are includible in the gross income of such beneficiary when the amounts so includible are $600 or more in any calendar year. The amounts includible in the gross income of the beneficiary include any interest payments due him under the retirement system.

Accordingly, it is held that the employer identification number of the retirement system and the account number of the beneficiary must be included in the Forms 1096 and 1099 filed with respect to payments of benefits by the retirement system.