Instructions For Forms 1099-R And 5498 - Distributions From Pensions, Annuities, Retirement Or Profit-Sharing Plans, Iras, Insurance Contracts, Etc. And Ira Contribution Information - 2016 Page 14
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24If a total distribution is made, the total employee
1099-R. For example, if part of a distribution is premature
contributions or insurance premiums available to be
(Code 1) and part is not (Code 7), file one Form 1099-R
recovered tax free must be shown only in box 5. If any
for the part to which Code 1 applies and another Form
previous distributions were made, any amount recovered
1099-R for the part to which Code 7 applies. In addition,
tax free in prior years must not appear in box 5.
for the distribution of excess deferrals, parts of the
distribution may be taxable in 2 different years. File
If you are unable to reasonably obtain the data
separate Forms 1099-R using Code 8 or P to indicate the
necessary to compute the taxable amount, leave boxes
year the amount is taxable.
2a and 5 blank, and check the first box in box 2b.
Even if the employee/taxpayer is age 59
or over, use
1
For more information, see Rev. Proc. 92-86, 1992-2
2
Code 1 if a series of substantially equal periodic payments
C.B. 495 and section 72(d).
was modified within 5 years of the date of the first
For reporting charitable gift annuities, see Charitable
payment (within the meaning of section 72(q)(3) or (t)(4)),
gift annuities, earlier.
if you have been reporting distributions in previous years
using Code 2.
Box 6. Net Unrealized Appreciation (NUA) in
For example, Mr. B began receiving payments that
Employer's Securities
qualified for the exception for part of a series of
Use this box if a distribution from a qualified plan (except
substantially equal periodic payments under section 72(t)
a qualified distribution from a designated Roth account)
(2)(A)(iv) when he was 57. When he was 61, Mr. B
includes securities of the employer corporation (or a
modified the payments. Because the payments were
subsidiary or parent corporation) and you can compute
modified within 5 years, use Code 1 in the year the
the NUA in the employer's securities. Enter all the NUA in
payments were modified, even though Mr. B is over 59
.
1
2
employer securities if this is a lump-sum distribution. If this
If you do not know that the taxpayer meets the
is not a lump-sum distribution, enter only the NUA in
requirements for substantially equal periodic payments
employer securities attributable to employee
under section 72(t)(2)(A)(iv), use Code 1 to report the
contributions. See Regulations section 1.402(a)-1(b) for
payments.
the determination of the NUA. Also see Notice 89-25, Q/
A-1, 1989-1 C.B. 662. Include the NUA in box 1 but not in
For further guidance on what makes a series of
box 2a except in the case of a direct rollover to a Roth IRA
substantially equal periodic payments, see Notice
!
(see Notice 2009-75, Q/A 1). You do not have to complete
89-25, Q/A-12, as modified by Rev. Rul. 2002-62,
CAUTION
this box for a direct rollover.
2002-42 I.R.B. 710. Notice 2004-15, 2004-9 I.R.B. 526,
available at ,
Box 7. Distribution Code(s)
allows taxpayers to use one of three methods in Notice
Enter an “X” in the IRA/SEP/SIMPLE checkbox if the
89-25, as modified by Rev. Rul. 2002-62, to determine
distribution is from a traditional IRA, SEP IRA, or SIMPLE
whether a distribution from a nonqualified annuity is part
IRA. Do not check the box for a distribution from a Roth
of a series of substantially equal periodic payments under
IRA or for an IRA recharacterization.
section 72(q)(2)(D).
Enter the appropriate code(s) in box 7. Use the Guide
If part of a distribution is paid in a direct rollover and
to Distribution Codes, later, to determine the appropriate
part is not, you must file a separate Form 1099-R for each
code(s) to enter in box 7 for any amounts reported on
part showing the appropriate code on each form.
Form 1099-R. Read the codes carefully and enter them
Governmental section 457(b) plan distributions.
accurately because the IRS uses the codes to help
Generally, a distribution from a governmental section
determine whether the recipient has properly reported the
457(b) plan is not subject to the 10% additional tax under
distribution. If the codes you enter are incorrect, the IRS
section 72(t). However, an early distribution from a
may improperly propose changes to the recipient's taxes.
governmental section 457(b) plan of an amount that is
When applicable, enter a numeric and an alpha code.
attributable to a rollover from another type of eligible
For example, when using Code P for a traditional IRA
retirement plan or IRA is subject to the additional tax as if
distribution under section 408(d)(4), you must also enter
the distribution were from a plan described in section
Code 1, if it applies. For a normal distribution from a
401(a). See section 72(t)(9). If the distribution consists
qualified plan that qualifies for the 10-year tax option,
solely of amounts that are not attributable to such a
enter Codes 7 and A. For a direct rollover to an IRA or a
rollover, enter Code 2 in box 7. If the distribution consists
qualified plan for the surviving spouse of a deceased
solely of amounts attributable to such a rollover, then
participant, or on behalf of a nonspouse designated
enter the appropriate code in box 7 as if the distribution
beneficiary, enter Codes 4 and G (Codes 4 and H if from a
were from a plan described in section 401(a). If the
designated Roth account to a Roth IRA). If two or more
distribution is made up of amounts from both sources, you
distribution codes are not valid combinations, you must
must file separate Forms 1099-R for each part of the
file more than one Form 1099-R.
distribution unless Code 2 would be entered on
each form.
Enter a maximum of two alpha/numeric codes in
box 7. See the Guide to Distribution Codes, later,
!
Box 8. Other
for allowable combinations. Only three numeric
Enter the current actuarial value of an annuity contract
CAUTION
combinations are permitted on one Form 1099-R: Codes
that is part of a lump-sum distribution. Do not include this
8 and 1, 8 and 2, or 8 and 4. If two or more other numeric
item in boxes 1 and 2a.
codes are applicable, you must file more than one Form
-14-
Instructions for Forms 1099-R and 5498 (2016)
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