Form 5498?

[SueBaby]

I have a form 5498 and my software does not have it and does this go on a form 5329?

Never heard of a form 5498. It is IRA contribution box 2 rollover is $52,683 and box 5 fair market value is $18,087. Box 7 ck for IRA.
So where does all of this go?

[David1980]

5498 are more informational than anything.

In this case, it could be useful in determining how much of a 1099-R was rolled over. So if they got a 1099-R for $100k and it shows a rollover of $52,683 you would basically have a partial rollover with taxable $47,317.

[SueBaby]

5498 are more informational than anything.

In this case, it could be useful in determining how much of a 1099-R was rolled over. So if they got a 1099-R for $100k and it shows a rollover of $52,683 you would basically have a partial rollover with taxable $47,317.

I got 1099-R with the whole thing rollover $52,683 but a corrected one that came with the form 5498 that has $27,500 in box 1 and 2 and code is 1 ck for IRA .

So my question is what do I put on the form 5329 and what line since I have not used it before? They have over 22,000 of medical bills because of a wreck. I am confussed and a few days to go is not a good thing! Thanks for any thing on this mixed up mess I have.

[David1980]

5498 itself doesn't get reported anywhere. No lines, no forms. If a 1099-R was an indirect rollover it's useful to determine the amount that was rolled over. If they had a distribution from a traditional IRA with basis, the FMV can be useful to determine the taxable amount. And if they had traditional IRA regular contributions you can find the amount.

It's purely information, requires no reporting, and provides information that could have been obtained by simply asking the taxpayer.

I'd be more concerned over a "corrected" 1099-R for only $27,500 when there were rollover contributions of $52,683. It does not make sense that could take out $27,500 and then rollover $52,683 of it.

So what did the taxpayer actually do? Go beyond the forms. Did they rollover a 401k or something? How much was the total rollover? Did they receive an additional $27,500 in cash (suggesting separate 1099-R) or did they never see or touch the cash and it was direct to the IRA?

Based on what the taxpayer actually did you can determine what should be reported.

[SueBaby]

5329 itself doesn't get reported anywhere. No lines, no forms. If a 1099-R was an indirect rollover it's useful to determine the amount that was rolled over. If they had a distribution from a traditional IRA with basis, the FMV can be useful to determine the taxable amount. And if they had traditional IRA regular contributions you can find the amount.

It's purely information, requires no reporting, and provides information that could have been obtained by simply asking the taxpayer.

I'd be more concerned over a "corrected" 1099-R for only $27,500 when there were rollover contributions of $52,683. It does not make sense that could take out $27,500 and then rollover $52,683 of it.

So what did the taxpayer actually do? Go beyond the forms. Did they rollover a 401k or something? How much was the total rollover? Did they receive an additional $27,500 in cash (suggesting separate 1099-R) or did they never see or touch the cash and it was direct to the IRA?

Based on what the taxpayer actually did you can determine what should be reported.

They took out 27,500 plus extra out of the 401-K which is 18,549 for medical expenses. Do I use the FMV anywhere? I have put one in the taxpayers name and another one in the spouse name since both took out their 401-K.
but don't know if I am filling this form out right or not?! sorry but

[David1980]

Oh, so two different 1099-R? I misread an earlier post, thought you meant that they received the 1099-R for 52k and then a corrected 1099-R for the same distribution of 27.5k.

With two 1099-R this makes more sense. The one for 52k was rolled over. If the 1099-R has code G then you don't have to do anything. If it's a different code, you probably have to mark it as a rollover somewhere. The amount rolled over (all the 52k) won't be included in the taxable amount. So it'll show on 15a or 16a but not in 15b or 16b.

The second 1099-R is probably just a normal 1099-R. Box 7 code 1, use 5329 code 5 for the exception due to medical expenses. It's only the medical expenses that exceed 7.5% of AGI, so they'll probably still have a penalty on a good chunk of that 27.5k, and of course income tax on all of it.

The FMV in this case doesn't do anything. If they had a traditional IRA with basis that wasn't rolled over the FMV comes into play on the calculation of the taxable amount.

[SueBaby]

Oh, so two different 1099-R? I misread an earlier post, thought you meant that they received the 1099-R for 52k and then a corrected 1099-R for the same distribution of 27.5k.

With two 1099-R this makes more sense. The one for 52k was rolled over. If the 1099-R has code G then you don't have to do anything. If it's a different code, you probably have to mark it as a rollover somewhere. The amount rolled over (all the 52k) won't be included in the taxable amount. So it'll show on 15a or 16a but not in 15b or 16b.

The second 1099-R is probably just a normal 1099-R. Box 7 code 1, use 5329 code 5 for the exception due to medical expenses. It's only the medical expenses that exceed 7.5% of AGI, so they'll probably still have a penalty on a good chunk of that 27.5k, and of course income tax on all of it.

The FMV in this case doesn't do anything. If they had a traditional IRA with basis that wasn't rolled over the FMV comes into play on the calculation of the taxable amount.

Thanks alot David this has really helped me.