Incentive payments and tax filing


Q: I retired from the U.S. Postal Service on Oct. 31 and received a $10,000 incentive payment in December that was counted as part of my 2009 earned income. As part of the incentive package, I will receive another $5,000 this October. This has nothing to do with my retirement annuity, so will it again be counted as earned income for 2010? If so, I will be able to contribute it to my Roth IRA, correct?

A: This is really a question for your tax preparer, but I expect that income to be reported for tax year 2010.


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Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to and view his blog at

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