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Retirement Plan Forms Used in Your Tax Return

By Beverly DeVeny, IRA Technical Expert

Follow Me on Twitter: @BevIRAEdSlott

IRS has announced that they are now processing all 2012 tax returns. Tax season is in full swing. What IRS forms might you need to file your tax return if you have any retirement plan transactions?

IRS Form 5498
You will receive Form 5498 from your custodian if you made any IRA contributions in 2012. This form is informational only and must be sent to you in May, 2013. You will also receive this form if you did any Roth conversions or recharacterizations in 2012. This form does not go on your tax return.

IRS Form 1099-R
If you took any distributions from an employer plan or distributions from an IRA or Roth IRA in 2012, you will receive Form 1099-R. This form was sent to you in January, 2013. You should NOT receive this form if you did a direct transfer of IRA or Roth IRA funds from one custodian to another.

IRS Form 8606
You must file this form if you made an after-tax contribution to an IRA in 2012, if you took a distribution from any IRA when you have after-tax funds in any IRA, if you did an IRA to Roth IRA conversion, or if you took a Roth IRA distribution.

IRS Form 5329
This form is filed when you have incurred IRA penalties. You must file this form if you owe a penalty for an excess contribution (6%), if you took a distribution subject to the early distribution penalty (10%), or if you missed all or part of a required distribution (50%). This last penalty can be waived for good cause. You want to be sure you file this form if you owe any of these penalties. It has its own signature line and is considered a tax return by IRS (and the courts). If you do not file this form and pay any penalties due, the statute of limitations does not start to run and IRS can come back at any time and assess penalties, interest, accuracy related penalties, and failure to file penalties. This can get really ugly.

It is not uncommon for the forms issued by plans and custodians to contain inaccurate information. Be sure you let your tax preparer know about any retirement plan transactions you made during the year. This will help him or her prepare your return accurately and correctly.

Article Highlights:

  • Forms you might need to prepare your tax return include IRS Form 5498, IRS Form 1099-R, IRS Form 8606 and IRS Form 5239
  • Check them for accuracy
  • Be sure to let your tax preparer know of your transactions for the year

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