Reporting Periodic Distributions from NFP 457b Plan

[Alex]

Not For Profit (NFP) sponsor of 457b plan permits retired participants to either take a lump sum distribution or equal payments over a 10 year period after retirement.  For those who take the lump sum option, this distribution amount is included in their final issued W-2 as they are still on payroll.   The instructions for W-2 indicate that distributions from a NFP 457b plan are to be reflected on a W-2.   If retired employee is no longer employed by the NFP, is the NFP still to report the annual distributions on a W-2 with required withholding or are there any other options? (1099Misc??)  Thanks

[Carol V. Calhoun]

The W-2 is the only option. The amount is wages, and is subject to income (though not FICA) withholding as such, even though payment is delayed until after termination of employment. It's the same way as you would deal with deferred compensation from a taxable entity. 

[CuseFan]

Tax w/h - FICA et al should have been w/h along the way - and agree W-2 is only option regardless, except death benefits if subsequently applicable.

[Alex]

Thank you both for your responses!  It is appreciated!