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2016

Department of the Treasury

Internal Revenue Service

Instructions for

Forms 1099-QA and 5498-QA

Distributions from ABLE Accounts and ABLE Account Contribution Information

Section references are to the Internal Revenue Code

exceeding $14,000 for the calendar year in which the tax

unless otherwise noted.

year begins (an “excess contribution”).

Future Developments

Separate accounting. A qualified ABLE program must

provide separate accounting for each designated

For the latest information about developments related to

beneficiary.

Forms 1099-QA and 5498-QA and their instructions, such

Limited investment direction. A qualified ABLE

as legislation enacted after they were published, go to

program provides that a designated beneficiary may

directly or indirectly direct the investment of any

What's New

contributions to the program (or any earnings on it) no

more than 2 times in any calendar year.

Public Law 114-113, Division Q, section 303, eliminates

Pledging of interest as security. A program is not

the residency requirement for qualified ABLE Programs.

treated as a qualified ABLE program if it allows any

Reminder

interest in the program or any portion of it to be used as

security for a loan.

In addition, you should also use the 2016 General

Instructions for Certain Information Returns. Those

Excess aggregate contributions. A qualified ABLE

general instructions include information about the

program must provide adequate safeguards to prevent

following topics.

aggregate contributions on behalf of a designated

Who must file (nominee/middleman).

beneficiary in excess of the limit established by the State

When and where to file.

under the State's qualified tuition program. Aggregate

Electronic reporting requirements.

contributions include contributions to any prior ABLE

Corrected and void returns.

account maintained by any qualified ABLE program for

Statements to recipients.

the same designated beneficiary or any prior designated

Taxpayer identification numbers.

beneficiary.

Backup withholding.

Return of excess contributions and excess aggre-

Penalties.

gate contributions. A qualified ABLE program must

Other general topics.

return an excess contribution or excess aggregate

contribution (including all net income attributable to that

You can get the general instructions at

excess contribution or excess aggregate contribution) to

form1099qa

the person who made the contribution on or before the

due date (including extensions) for the Federal income tax

Qualified ABLE Program

return of the designated beneficiary for the tax year in

A qualified ABLE program is a program established and

which the excess contribution or excess aggregate

maintained by a State, or agency, or instrumentality of a

contribution was made.

State:

Rollovers and program-to-program transfers. For

Under which an ABLE account may be established for a

purposes of these instructions, a “rollover” means a

blind or disabled individual whose blindness or disability

contribution to an ABLE account of the designated

occurred before age 26 (an “eligible individual”), who is

beneficiary (or of an eligible individual who is a member of

the owner and designated beneficiary of the account;

the family of the designated beneficiary) of all or a portion

Which permits contributions to such ABLE account to

of an amount withdrawn from the designated beneficiary’s

pay for the qualified disability expenses of the account’s

ABLE account, provided the contribution is made within

designated beneficiary;

60 days of the date of the withdrawal and, in the case of a

Which limits a designated beneficiary to one ABLE

rollover to the designated beneficiary’s ABLE account, no

account.

rollover has been made to an ABLE account of the

That meets the other requirements of section 529A.

designated beneficiary within the prior 12 months.

Cash contributions. A program is not treated as a

A “program-to-program transfer” means the direct

qualified ABLE program unless it provides that no

transfer of the entire balance of an ABLE account to an

contribution will be accepted:

ABLE account of the same designated beneficiary in

unless it is in cash; or

which the transferor ABLE account is closed upon

except in the case of a rollover or program-to-program

completion of the transfer, or of part or all of the balance

transfer, if such contribution would result in contributions

to an ABLE account of another eligible individual who is a

from all contributors to the ABLE account for the tax year

member of the family of the former designated

Sep 16, 2016

Cat. No. 67557E

Instructions For Forms 1099-Qa And 5498-Qa - Distributions From Able Accounts And Able Account Contribution Information - 2016 Page 3

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