Instructions For Forms 1099-R And 5498 - 2015 (Page 13 of 23) in pdf

protection) (only if the life insurance contract itself is

IRAs. The 20% withholding does not apply to

distributed), and (d) premiums paid on commercial

distributions from any IRA, but withholding does apply to

annuities. Do not include any DVECs, elective deferrals,

IRAs under the rules for periodic payments and

or any contribution to a retirement plan that was not an

nonperiodic distributions. For withholding, assume that

after-tax contribution.

the entire amount of a distribution from an IRA other than

a Roth IRA is taxable (except for the distribution of

Generally, for qualified plans, section 403(b) plans, and

contributions under section 408(d)(4), in which only the

nonqualified commercial annuities, enter in box 5 the

earnings are taxable, and section 408(d)(5), as

employee contributions or insurance premiums recovered

applicable). Generally, Roth IRA distributions are not

tax free during the year based on the method you used to

subject to withholding except on the earnings portion of

determine the taxable amount to be entered in box 2a. On

excess contributions distributed under section 408(d)(4).

a separate Form 1099-R, include the portion of the

An IRA recharacterization is not subject to income tax

employee's basis that has been distributed from a

withholding.

designated Roth account. See the Examples in the

instructions for box 2a, earlier.

Periodic payments. For periodic payments that are not

eligible rollover distributions, withhold on the taxable part

If periodic payments began before 1993, you are not

as though the periodic payments were wages, based on

required to, but you are encouraged to, report in box 5.

the recipient's Form W-4P. The recipient may request

If you made periodic payments from a qualified

additional withholding on Form W-4P or claim exemption

plan and the annuity starting date is after

from withholding. If a recipient does not submit a Form

November 18, 1996, you must use the simplified

W-4P, withhold by treating the recipient as married with

CAUTION

method to figure the tax-free amount each year. See

three withholding allowances. See Circular E, Employer's

Annuity starting date in 1998 or later, earlier.

Tax Guide (Pub. 15), for wage withholding tables.

If a total distribution is made, the total employee

Rather than Form W-4P, military retirees should

contributions or insurance premiums available to be

give you Form W-4, Employee's Withholding

TIP

Allowance Certificate.

recovered tax free must be shown only in box 5. If any

previous distributions were made, any amount recovered

Nonperiodic distributions. Withhold 10% of the taxable

tax free in prior years must not appear in box 5.

part of a nonperiodic distribution that is not an eligible

If you are unable to reasonably obtain the data

rollover distribution. In most cases, designated

necessary to compute the taxable amount, leave boxes

distributions from any IRA are treated as nonperiodic

2a and 5 blank, and check the first box in box 2b.

distributions subject to withholding at the 10% rate even if

the distributions are paid over a periodic basis. See

For more information, see Rev. Proc. 92-86, 1992-2

Regulations section 35.3405-1T, Q/A F-15. The recipient

C.B. 495 and section 72(d).

may request additional withholding on Form W-4P or

For reporting charitable gift annuities, see Charitable

claim exemption from withholding.

gift annuities, earlier.

Failure to provide TIN. For periodic payments and

nonperiodic distributions, if a payee fails to furnish his or

Box 6. Net Unrealized Appreciation (NUA) in

her correct TIN to you in the manner required, or if the IRS

Employer's Securities

notifies you before any distribution that the TIN furnished

Use this box if a distribution from a qualified plan (except

is incorrect, a payee cannot claim exemption from

a qualified distribution from a designated Roth account)

withholding. For periodic payments, withhold as if the

includes securities of the employer corporation (or a

payee was single claiming no withholding allowances. For

subsidiary or parent corporation) and you can compute

nonperiodic payments, withhold 10%. Backup withholding

the NUA in the employer's securities. Enter all the NUA in

does not apply.

employer securities if this is a lump-sum distribution. If this

is not a lump-sum distribution, enter only the NUA in

Box 5. Employee Contributions/Designated

employer securities attributable to employee

Roth Contributions or Insurance Premiums

contributions. See Regulations section 1.402(a)-1(b) for

Enter the employee's contributions, designated Roth

the determination of the NUA. Also see Notice 89-25, Q/

contributions, or insurance premiums that the employee

A-1, 1989-1 C.B. 662. Include the NUA in box 1 but not in

may recover tax free this year (even if they exceed the

box 2a except in the case of a direct rollover to a Roth IRA

box 1 amount). The entry in box 5 may include any of the

(see Notice 2009-75, Q/A 1). You do not have to complete

following: (a) designated Roth contributions or

this box for a direct rollover.

contributions actually made on behalf of the employee

over the years under the plan that were required to be

Box 7. Distribution Code(s)

included in the income of the employee when contributed

Enter an “X” in the IRA/SEP/SIMPLE checkbox if the

(after-tax contributions), (b) contributions made by the

distribution is from a traditional IRA, SEP IRA, or SIMPLE

employer but considered to have been contributed by the

IRA. Do not check the box for a distribution from a Roth

employee under section 72(f), (c) the accumulated cost of

IRA or for an IRA recharacterization.

premiums paid for life insurance protection taxable to the

Enter the appropriate code(s) in box 7. Use the Guide

employee in previous years and in the current year under

to Distribution Codes, later, to determine the appropriate

Regulations section 1.72-16 (cost of current life insurance

code(s) to enter in box 7 for any amounts reported on

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Instructions for Forms 1099-R and 5498 (2015)

Instructions For Forms 1099-R And 5498 - 2015 Page 13

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