Instructions for IRS Form 1099-R, 5498

This document contains official instructions for IRS Form 1099-R, and IRS Form 5498. Both forms are released and collected by the Internal Revenue Service (IRS), a subdivision of the U.S. Department of the Treasury. An up-to-date fillable IRS Form 1099-R is available for download through this link. The latest available IRS Form 5498 can be downloaded through this link.

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2021
Department of the Treasury
Internal Revenue Service
Instructions for Forms
1099-R and 5498
Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs,
Insurance Contracts, etc.
Section references are to the Internal Revenue Code unless
annuities, pensions, insurance contracts, survivor income
otherwise noted.
benefit plans, permanent and total disability payments under
life insurance contracts, charitable gift annuities, etc.
Future Developments
Also, report on Form 1099-R death benefit payments
For the latest information about developments related to
made by employers that are not made as part of a pension,
Forms 1099-R and 5498 and their instructions, such as
profit-sharing, or retirement plan. See
Box
1, later.
legislation enacted after they were published, go to
IRS.gov/
Form1099R
or IRS.gov/Form5498.
Payments of reportable death benefits in accordance with
What’s New
final regulations published under section 6050Y must be
reported on Form 1099-R.
Form 1099-R
Reportable disability payments made from a retirement
Safe harbor explanations for eligible rollover distribu-
plan must be reported on Form 1099-R.
tions.
Notice 2020-62
contains the two model notices that
Generally, do not report payments subject to withholding
may be provided to recipients of eligible rollover distributions
of social security and Medicare taxes on this form. Report
to satisfy the notice requirements under section 402(f). See
such payments on Form W-2, Wage and Tax Statement.
Explanation to Recipients Before Eligible Rollover
Distributions (Section 402(f)
Notice), later.
There is no special reporting for qualified charitable
Reminders
distributions under section 408(d)(8), qualified health
TIP
savings account (HSA) funding distributions
In addition, see the 2021 General Instructions for Certain
described in section 408(d)(9), or for the payment of qualified
Information Returns for information on the following topics.
health insurance premiums (including long-term care
Who must file (certain Foreign Financial Institutions (FFIs)
insurance premiums) for retired public safety officers
and U.S. payers that report on Form(s) 1099 to satisfy their
described in section 402(l).
Internal Revenue Code chapter 4 reporting requirements).
When and where to file.
Reportable death benefits. Under section 6050Y and the
Electronic reporting.
Regulations thereunder, a payer must report reportable
Corrected and void returns.
death benefits paid after December 31, 2018, in connection
Statements to recipients.
with a life insurance contract transferred after December 31,
Taxpayer identification numbers (TINs).
2018, in a reportable policy sale. Reportable death benefits
Backup withholding.
are amounts paid by reason of the death of the insured under
Penalties.
a life insurance contract that has been transferred in a
The definitions of terms applicable for chapter 4 purposes
reportable policy sale. In general, a reportable policy sale is
that are referenced in these instructions.
the acquisition of an interest in a life insurance contract,
Other general topics.
directly or indirectly, if the acquirer has no substantial family,
business, or financial relationship with the insured apart from
You can get the general instructions from
General
the acquirer's interest in such life insurance contract. The
Instructions for Certain Information Returns
at
IRS.gov/
payer of reportable death benefits must file a return that
1099GeneralInstructions
or go to
IRS.gov/Form1099R
or
includes certain information, including the name of the
IRS.gov/Form5498.
reportable death benefits payment recipient, the date and
Online fillable forms. To ease statement furnishing
gross amount of each payment, and the payer's estimate of
requirements, Copies B, C, D, 1, and 2 have been made
the buyer's investment in the contract. Under Regulations
fillable online in a PDF format available at
IRS.gov/
section 1.6050Y-4(e), however, a payer does not have to file
Form1099R
and IRS.gov/Form5498. You can complete
a return for reportable death benefits payments in certain
these copies online for furnishing statements to recipients
situations, including when the reportable death benefits
and for retaining in your own files.
payments are made to certain foreign payees and when the
payer does not receive, and has no knowledge of any issuer
Specific Instructions for Form 1099-R
having received, a reportable policy sale payment statement.
File Form 1099-R, Distributions From Pensions, Annuities,
Military retirement annuities. Report payments to military
Retirement or Profit-Sharing Plans, IRAs, Insurance
retirees or payments of survivor benefit annuities on Form
Contracts, etc., for each person to whom you have made a
1099-R. Report military retirement pay awarded as a property
designated distribution or are treated as having made a
settlement to a former spouse under the name and TIN of the
distribution of $10 or more from profit-sharing or retirement
recipient, not that of the military retiree.
plans, any individual retirement arrangements (IRAs),
Jan 06, 2021
Cat. No. 27987M
2021
Department of the Treasury
Internal Revenue Service
Instructions for Forms
1099-R and 5498
Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs,
Insurance Contracts, etc.
Section references are to the Internal Revenue Code unless
annuities, pensions, insurance contracts, survivor income
otherwise noted.
benefit plans, permanent and total disability payments under
life insurance contracts, charitable gift annuities, etc.
Future Developments
Also, report on Form 1099-R death benefit payments
For the latest information about developments related to
made by employers that are not made as part of a pension,
Forms 1099-R and 5498 and their instructions, such as
profit-sharing, or retirement plan. See
Box
1, later.
legislation enacted after they were published, go to
IRS.gov/
Form1099R
or IRS.gov/Form5498.
Payments of reportable death benefits in accordance with
What’s New
final regulations published under section 6050Y must be
reported on Form 1099-R.
Form 1099-R
Reportable disability payments made from a retirement
Safe harbor explanations for eligible rollover distribu-
plan must be reported on Form 1099-R.
tions.
Notice 2020-62
contains the two model notices that
Generally, do not report payments subject to withholding
may be provided to recipients of eligible rollover distributions
of social security and Medicare taxes on this form. Report
to satisfy the notice requirements under section 402(f). See
such payments on Form W-2, Wage and Tax Statement.
Explanation to Recipients Before Eligible Rollover
Distributions (Section 402(f)
Notice), later.
There is no special reporting for qualified charitable
Reminders
distributions under section 408(d)(8), qualified health
TIP
savings account (HSA) funding distributions
In addition, see the 2021 General Instructions for Certain
described in section 408(d)(9), or for the payment of qualified
Information Returns for information on the following topics.
health insurance premiums (including long-term care
Who must file (certain Foreign Financial Institutions (FFIs)
insurance premiums) for retired public safety officers
and U.S. payers that report on Form(s) 1099 to satisfy their
described in section 402(l).
Internal Revenue Code chapter 4 reporting requirements).
When and where to file.
Reportable death benefits. Under section 6050Y and the
Electronic reporting.
Regulations thereunder, a payer must report reportable
Corrected and void returns.
death benefits paid after December 31, 2018, in connection
Statements to recipients.
with a life insurance contract transferred after December 31,
Taxpayer identification numbers (TINs).
2018, in a reportable policy sale. Reportable death benefits
Backup withholding.
are amounts paid by reason of the death of the insured under
Penalties.
a life insurance contract that has been transferred in a
The definitions of terms applicable for chapter 4 purposes
reportable policy sale. In general, a reportable policy sale is
that are referenced in these instructions.
the acquisition of an interest in a life insurance contract,
Other general topics.
directly or indirectly, if the acquirer has no substantial family,
business, or financial relationship with the insured apart from
You can get the general instructions from
General
the acquirer's interest in such life insurance contract. The
Instructions for Certain Information Returns
at
IRS.gov/
payer of reportable death benefits must file a return that
1099GeneralInstructions
or go to
IRS.gov/Form1099R
or
includes certain information, including the name of the
IRS.gov/Form5498.
reportable death benefits payment recipient, the date and
Online fillable forms. To ease statement furnishing
gross amount of each payment, and the payer's estimate of
requirements, Copies B, C, D, 1, and 2 have been made
the buyer's investment in the contract. Under Regulations
fillable online in a PDF format available at
IRS.gov/
section 1.6050Y-4(e), however, a payer does not have to file
Form1099R
and IRS.gov/Form5498. You can complete
a return for reportable death benefits payments in certain
these copies online for furnishing statements to recipients
situations, including when the reportable death benefits
and for retaining in your own files.
payments are made to certain foreign payees and when the
payer does not receive, and has no knowledge of any issuer
Specific Instructions for Form 1099-R
having received, a reportable policy sale payment statement.
File Form 1099-R, Distributions From Pensions, Annuities,
Military retirement annuities. Report payments to military
Retirement or Profit-Sharing Plans, IRAs, Insurance
retirees or payments of survivor benefit annuities on Form
Contracts, etc., for each person to whom you have made a
1099-R. Report military retirement pay awarded as a property
designated distribution or are treated as having made a
settlement to a former spouse under the name and TIN of the
distribution of $10 or more from profit-sharing or retirement
recipient, not that of the military retiree.
plans, any individual retirement arrangements (IRAs),
Jan 06, 2021
Cat. No. 27987M
Use Code 7 in box 7 for reporting military pensions or
another contract of endowment insurance that provides for
survivor benefit annuities. Use Code 4 for reporting
regular payments to begin no later than they would have
!
death benefits paid to a survivor beneficiary on a
begun under the old contract, or for an annuity contract, or for
CAUTION
separate Form 1099-R. Do not combine with any other
a qualified long-term care insurance contract; or (c) an
codes.
annuity contract for an annuity contract or for a qualified
long-term care insurance contract; or (d) a qualified
Governmental section 457(b) plans. Report on Form
long-term care insurance contract for a qualified long-term
1099-R, not Form W-2, income tax withholding and
care insurance contract. A contract shall not fail to be treated
distributions from a section 457(b) plan maintained by a state
as an annuity contract or as a life insurance contract solely
or local government employer. Distributions from a
because a qualified long-term care insurance contract is a
governmental section 457(b) plan to a participant or
part of or a rider on such contract. However, the distribution
beneficiary include all amounts that are paid from the plan.
of other property or the cancellation of a contract loan at the
For more information, see Notice 2003-20 on page 894 of
time of the exchange may be taxable and reportable on a
Internal Revenue Bulletin 2003-19, at
IRS.gov/pub/irs-irbs/
separate Form 1099-R.
irb03-19.pdf. Also, see
Governmental section 457(b) plan
These exchanges of contracts are generally reportable on
distributions, later, for information on distribution codes.
Form 1099-R. However, reporting on Form 1099-R is not
required if (a) the exchange occurs within the same
Nonqualified plans. Report any reportable distributions
company; (b) the exchange is solely a contract for contract
from commercial annuities. Report distributions to employee
exchange, as defined above, that does not result in a
plan participants from section 409A nonqualified deferred
designated distribution; and (c) the company maintains
compensation plans and eligible nongovernmental section
adequate records of the policyholder's basis in the contracts.
457(b) plans on Form W-2, not on Form 1099-R; for
For example, a life insurance contract issued by Company X
nonemployees, these payments are reportable on Form
received in exchange solely for another life insurance
1099-NEC. Report distributions to beneficiaries of deceased
contract previously issued by Company X does not have to
plan participants on Form 1099-MISC. See the Instructions
be reported on Form 1099-R as long as the company
for Forms 1099-MISC and 1099-NEC for more information.
maintains the required records. See Rev. Proc. 92-26,
Section 404(k) dividends. Distributions of section 404(k)
1992-1 C.B. 744, for certain exchanges for which reporting is
dividends from an employee stock ownership plan (ESOP),
not required under section 6047(d). Also, see Rev. Rul.
including a tax credit ESOP, are reported on Form 1099-R.
2007-24, 2007-21 I.R.B. 1282, available at
IRS.gov/irb/
Distributions other than section 404(k) dividends from the
2007-21_IRB#RR-2007-24, for certain transactions that do
plan must be reported on a separate Form 1099-R.
not qualify as tax-free exchanges. For more information on
Section 404(k) dividends paid directly from the
partial exchanges of annuity contracts, see Rev. Proc.
corporation to participants or their beneficiaries are reported
2011-38, 2011-30 I.R.B. 66, available at
IRS.gov/irb/
on Form 1099-DIV. See Announcement 2008-56, 2008-26
2011-30_IRB#RP-2011-38.
I.R.B. 1192, available at
IRS.gov/irb/
Regulations under section 6050Y provide that a section
2008-26_IRB#ANN-2008-56.
1035 exchange constitutes a reportable policy sale in limited
Charitable gift annuities. If cash or capital gain property is
circumstances. Death benefits paid by reason of the death of
donated in exchange for a charitable gift annuity, report
the insured under the life insurance contract issued in such
distributions from the annuity on Form 1099-R. See
circumstances are reportable death benefits that must be
Charitable gift
annuities, later.
reported on Form 1099-R.
For more information on reporting taxable exchanges, see
Life insurance, annuity, and endowment contracts.
Box
1, later.
Report payments of matured or redeemed annuity,
endowment, and life insurance contracts. However, you do
Prohibited transactions. If an IRA owner engages in a
not need to file Form 1099-R to report the surrender of a life
prohibited transaction with respect to an IRA, the assets of
insurance contract if it is reasonable to believe that none of
the IRA are treated as distributed on the first day of the tax
the payment is includible in the income of the recipient. If you
year in which the prohibited transaction occurs. IRAs that
are reporting the surrender of a life insurance contract, see
hold non-marketable securities and/or closely held
Code 7, later. See, however,
Box
1, later, for
FFIs reporting in
investments, in which the IRA owner effectively controls the
a manner similar to section 6047(d)
for the purposes of
underlying assets of such securities or investments, have a
chapter 4 of the Internal Revenue Code.
greater potential for resulting in a prohibited transaction.
Report premiums paid by a trustee or custodian for the
Enter Code 5 in box 7.
cost of current life or other insurance protection. Costs of
Designated Roth Account Contributions
current life insurance protection are not subject to the 10%
additional tax under section 72(t). See
Cost of current life
An employer offering a section 401(k), 403(b), or
insurance
protection, later.
governmental section 457(b) plan may allow participants to
contribute all or a portion of the elective deferrals they are
Report charges or payments for a qualified long-term care
otherwise eligible to make to a separate designated Roth
insurance contract against the cash value of an annuity
account established under the plan. Contributions made
contract or the cash surrender value of a life insurance
under a section 401(k) plan must meet the requirements of
contract, which is excludable from gross income under
Regulations section 1.401(k)-1(f) (Regulations section
section 72(e)(11). See Code W, later.
1.403(b)-3(c) for a section 403(b) plan). Under the terms of
Section 1035 exchange. A tax-free section 1035
the section 401(k) plan, section 403(b) plan, or governmental
exchange is the exchange of (a) a life insurance contract for
section 457(b) plan, the designated Roth account must meet
another life insurance contract, or for an endowment or
the requirements of section 402A.
annuity contract, or for a qualified long-term care insurance
contract; or (b) a contract of endowment insurance for
-2-
Instructions for Forms 1099-R and 5498 (2021)
A separate Form 1099-R must be used to report the
Roth IRA conversions. You must report a traditional, SEP,
total annual distribution from a designated Roth
!
or SIMPLE IRA distribution that you know is converted this
account.
year to a Roth IRA in boxes 1 and 2a (checking box 2b
CAUTION
“Taxable amount not determined” unless otherwise directed
Distributions allocable to an in-plan Roth rollover (IRR).
elsewhere in these instructions), even if the conversion is a
The distribution of an amount allocable to the taxable amount
trustee-to-trustee transfer or is with the same trustee. Enter
of an IRR, made within the 5-year period beginning with the
Code 2 or 7 in box 7 depending on the participant's age.
first day of the participant’s tax year in which the rollover was
IRA escheatment. Payments made from IRAs to state
made, is treated as includible in gross income for purposes of
unclaimed property funds must be reported on Form 1099-R.
applying section 72(t) to the distribution. The total amount
See Rev. Rul. 2020-24, 2020-45 I.R.B. 965, available at
allocable to such an IRR is reported in box 10. See the
IRS.gov/irb/2020-45_IRB#REV-RUL-2020-24; and Rev. Rul.
instructions for
Box
10, later. An IRR is a rollover within a
2018-17, 2018-25 I.R.B. 753, available at
IRS.gov/irb/
retirement plan to a designated Roth account in the same
2018-25_IRB#RR-2018-17, as modified by Notice 2018-90,
plan. See Notice 2010-84, 2010-51 I.R.B. 872, available at
2018-49 I.R.B. 826, available at
https://www.irs.gov/irb/
IRS.gov/irb/2010-51_IRB#NOT-2010-84, as modified by
2018-49_IRB#NOT-2018-90.
Notice 2013-74, 2013-52 I.R.B. 819, available at
IRS.gov/irb/
2013-52_IRB#NOT-2013-74.
IRA Revocation or Account Closure
IRA Distributions
If a traditional or Roth IRA is revoked during its first 7 days
(under Regulations section 1.408-6(d)(4)(ii)) or is closed at
For deemed IRAs under section 408(q), use the rules
any time by the IRA trustee or custodian due to a failure of
that apply to traditional IRAs or Roth IRAs, as
TIP
the taxpayer to satisfy the Customer Identification Program
applicable. Simplified employee pension (SEP) IRAs
requirements described in section 326 of the USA PATRIOT
and savings incentive match plan for employees (SIMPLE)
Act, the distribution from the IRA must be reported. In
IRAs, however, may not be used as deemed IRAs.
addition, Form 5498, IRA Contribution Information, must be
filed to report any regular, rollover, Roth IRA conversion, SEP
Deemed IRAs. For more information on deemed IRAs in
IRA, or SIMPLE IRA contribution to an IRA that is
qualified employer plans, see Regulations section
subsequently revoked or closed by the trustee or custodian.
1.408(q)-1.
If a regular contribution is made to a traditional or Roth IRA
IRAs other than Roth IRAs. Unless otherwise instructed,
that later is revoked or closed, and a distribution is made to
distributions from any IRA that is not a Roth IRA must be
the taxpayer, enter the gross distribution in
reported in boxes 1 and 2a. Check the “Taxable amount not
box 1. If no earnings are distributed, enter 0 (zero) in box 2a
determined” box in box 2b. But see:
and Code 8 in box 7 for a traditional IRA and Code J for a
Traditional, SEP, or SIMPLE
IRA, later, for how to report
Roth IRA. If earnings are distributed, enter the amount of
the withdrawal of IRA contributions under section 408(d)(4);
earnings in box 2a. For a traditional IRA, enter Codes 1 and
Transfers, later, for information on trustee-to-trustee
8, if applicable, in box 7; for a Roth IRA, enter Codes J and 8,
transfers, including recharacterizations;
if applicable. These earnings could be subject to the 10%
Reporting a corrective distribution from an IRA under
early distribution tax under section 72(t). If a rollover
section 408(d)(5), see
Traditional, SEP, or SIMPLE
IRA,
contribution is made to a traditional or Roth IRA that later is
later;
revoked or closed, and distribution is made to the taxpayer,
Reporting IRA revocations or account closures due to
enter in boxes 1 and 2a of Form 1099-R the gross distribution
Customer Identification Program failures, see
IRA
and the appropriate code in box 7 (Code J for a Roth IRA).
Revocation or Account
Closure, later; and
Follow this same procedure for a transfer from a traditional or
Reporting a transfer from a SIMPLE IRA to a non-SIMPLE
Roth IRA to another IRA of the same type that later is
IRA within the first 2 years of plan participation, see
revoked or closed. The distribution could be subject to the
Traditional, SEP, or SIMPLE
IRA, later.
10% early distribution tax under section 72(t).
The direct rollover provisions beginning later do not apply
If an IRA conversion contribution or a rollover from a
to distributions from any IRA. However, taxable distributions
qualified plan is made to a Roth IRA that later is revoked or
from traditional IRAs and SEP IRAs may be rolled over into
closed, and a distribution is made to the taxpayer, enter the
an eligible retirement plan. See section 408(d)(3). SIMPLE
gross distribution in box 1 of Form 1099-R. If no earnings are
IRAs may also be rolled over into an eligible retirement plan,
distributed, enter 0 (zero) in box 2a and Code J in box 7. If
but only after the first 2 years of plan participation.
earnings are distributed, enter the amount of the earnings in
An IRA includes all investments under one IRA plan or
box 2a and Code J in box 7. These earnings could be subject
account. File only one Form 1099-R for distributions from all
to the 10% early distribution tax under section 72(t).
investments under one plan that are paid in 1 year to one
If an employer SEP IRA or SIMPLE IRA plan contribution
recipient, unless you must enter different codes in box 7. You
is made and the SEP IRA or SIMPLE IRA is revoked by the
do not have to file a separate Form 1099-R for each
employee or is closed by the trustee or custodian, report the
distribution under the plan.
distribution as fully taxable.
Roth IRAs. For distributions from a Roth IRA, report the
For more information on IRAs that have been revoked,
gross distribution in box 1 but generally leave box 2a blank.
see Rev. Proc. 91-70, 1991-2 C.B. 899.
Check the “Taxable amount not determined” box in box 2b.
Enter Code J, Q, or T, as appropriate, in box 7. Do not use
Deductible Voluntary Employee Contributions
any other codes with Code Q or Code T. You may enter
(DVECs)
Code 8 or P with Code J. For the withdrawal of excess
contributions, see
Roth
IRA, later. It is not necessary to mark
If you are reporting a total distribution from a plan that
the IRA/SEP/SIMPLE checkbox.
includes a distribution of DVECs, you may file a separate
-3-
Instructions for Forms 1099-R and 5498 (2021)
Form 1099-R to report the distribution of DVECs. If you do,
section 402(c)(3)(C) and Regulations section 1.402(c)-2,
report the distribution of DVECs in boxes 1 and 2a on the
Q/A-9 and
Plan Loan
Offsets, later.
separate Form 1099-R. For the direct rollover (explained
7. Section 404(k) dividends.
later) of funds that include DVECs, a separate Form 1099-R
8. Cost of current life insurance protection.
is not required to report the direct rollover of the DVECs.
9. Distributions to a payee other than the employee, the
Direct Rollovers
employee's surviving spouse, a spouse or former spouse
who is an alternate payee under a QDRO, or a nonspouse
You must report a direct rollover of an eligible rollover
designated beneficiary.
distribution. A direct rollover is the direct payment of the
10. Any hardship distribution.
distribution from a qualified plan, a section 403(b) plan, or a
governmental section 457(b) plan to a traditional IRA, Roth
11. A permissible withdrawal under section 414(w).
IRA, or other eligible retirement plan. For additional rules
12. Prohibited allocations of securities in an S corporation
regarding the treatment of direct rollovers from designated
that are treated as deemed distributions.
Roth accounts, see
Designated Roth
accounts, later. A direct
13. Distributions of premiums for accident or health
rollover may be made for the employee, for the employee's
insurance under Regulations section 1.402(a)-1(e).
surviving spouse, for the spouse or former spouse who is an
alternate payee under a qualified domestic relations order
Amounts paid under an annuity contract purchased for
(QDRO) or for a nonspouse designated beneficiary, in which
and distributed to a participant under a qualified plan can
case the direct rollover can only be made to an inherited IRA.
qualify as eligible rollover distributions. See Regulations
If the distribution is paid to the surviving spouse, the
section 1.402(c)-2, Q/A-10.
distribution is treated in the same manner as if the spouse
Automatic rollovers. Eligible rollover distributions may also
were the employee. See Part V of Notice 2007-7, 2007-5
include involuntary distributions that are more than $1,000
I.R.B. 395, available at
IRS.gov/irb/
but not more than $5,000 and are made from a qualified plan
2007-05_IRB#NOT-2007-7, which has been modified by
to an IRA on behalf of a plan participant. Involuntary
Notice 2009-82, 2009-41 I.R.B. 491, available at
IRS.gov/irb/
distributions are generally subject to the automatic rollover
2009-41_IRB#NOT-2009-82, and Notice 2020-51, 2020-29
provisions of section 401(a)(31)(B) and must be paid in a
I.R.B. 73, available at
IRS.gov/irb/
direct rollover to an IRA, unless the plan participant elects to
2020-29_IRB#NOT-2020-51, for guidance on direct rollovers
have the rollover made to another eligible retirement plan or
by nonspouse designated beneficiaries. Also, see Notice
to receive the distribution directly.
2008-30, Part II, 2008-12 I.R.B. 638, available at
IRS.gov/irb/
2008-12_IRB#NOT-2008-30, which has been amplified and
For information on the notification requirements, see
clarified by Notice 2009-75, 2009-39 I.R.B. 436, available at
Explanation to Recipients Before Eligible Rollover
IRS.gov/irb/2009-39_IRB#NOT-2009-75, for questions and
Distributions (Section 402(f)
Notice), later. For additional
answers covering rollover contributions to Roth IRAs.
information, also see Notice 2005-5, 2005-3 I.R.B. 337,
available at IRS.gov/irb/2005-03_IRB#NOT-2005-5, as
An eligible rollover distribution is any distribution of all or
modified by Notice 2005-95, 2005-51 I.R.B. 1172, available
any portion of the balance to the credit of the employee
at IRS.gov/irb/2005-51_IRB#NOT-2005-95.
(including net unrealized appreciation (NUA)) from a qualified
plan, a section 403(b) plan, or a governmental section 457(b)
Reporting a direct rollover. Report a direct rollover in
plan except the following.
box 1 and a 0 (zero) in box 2a, unless the rollover is a direct
rollover of a qualified rollover contribution other than from a
1. One of a series of substantially equal periodic
designated Roth account. See
Qualified rollover
payments made at least annually over:
contributions as defined in section
408A(e), later. You do not
a. The life of the employee or the joint lives of the
have to report capital gain in box 3 or NUA in box 6. Enter
employee and the employee's designated beneficiary,
Code G in box 7 unless the rollover is a direct rollover from a
b. The life expectancy of the employee or the joint life
designated Roth account to a Roth IRA. See
Designated
and last survivor expectancy of the employee and the
Roth
accounts, later. If the direct rollover is made by a
employee's designated beneficiary, or
nonspouse designated beneficiary, also enter Code 4 in
box 7.
c. A specified period of 10 years or more.
Prepare the form using the name and social security
2. A required minimum distribution (RMD) under section
number (SSN) of the person for whose benefit the funds
401(a)(9). A plan administrator is permitted to assume there
were rolled over (generally, the participant), not those of the
is no designated beneficiary for purposes of determining the
trustee of the traditional IRA or other plan to which the funds
minimum distribution.
were rolled.
3. Elective deferrals (under section 402(g)(3)) and
If part of the distribution is a direct rollover and part is
employee contributions (including earnings on each)
distributed to the recipient, prepare two Forms 1099-R.
returned because of the section 415 limits.
For guidance on allocation of after-tax amounts to
4. Corrective distributions of excess deferrals (under
rollovers, see Notice 2014-54, 2014-41 I.R.B. 670, available
section 402(g)) and earnings.
at IRS.gov/irb/2014-41_IRB#NOT-2014-54.
5. Corrective distributions of excess contributions under
For more information on eligible rollover distributions,
a qualified cash or deferred arrangement (under section
including substantially equal periodic payments, RMDs, and
401(k)) and excess aggregate contributions (under section
plan loan offset amounts, see Regulations sections
401(m)) and earnings.
1.402(c)-2 and 1.403(b)-7(b). See Rev. Rul. 2014-9, 2014-17
6. Loans treated as deemed distributions (under section
I.R.B. 975, available at
IRS.gov/irb/
72(p)). However, qualified plan loan offset amounts and plan
2014-17_IRB#RR-2014-9, for information on rollovers to
loan offset amounts can be eligible rollover distributions. See
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Instructions for Forms 1099-R and 5498 (2021)
qualified plans. Also, see Rev. Rul. 2002-62, which is on
A rollover contribution to a Roth IRA from another IRA that
page 710 of Internal Revenue Bulletin 2002-42 at
meets the requirements of section 408(d)(3), or
IRS.gov/pub/irs-irbs/irb02-42.pdf, for guidance on
A rollover contribution to a Roth IRA from an eligible
substantially equal periodic payments.
retirement plan (other than an IRA) that meets the
requirements of section 408A(e)(1)(B).
For information on distributions of amounts
For reporting a rollover from an IRA other than a Roth IRA
attributable to rollover contributions separately
TIP
to a Roth IRA, see Roth IRA conversions, earlier and later.
accounted for by an eligible retirement plan and if
permissible timing restrictions apply, see Rev. Rul. 2004-12,
For a direct rollover of an eligible rollover distribution to a
2004-7 I.R.B. 478, available at
IRS.gov/irb/
Roth IRA (other than from a designated Roth account), report
2004-07_IRB#RR-2004-12, as modified by Notice 2013-74,
the total amount rolled over in box 1, the taxable amount in
2013-52 I.R.B. 819, available at
IRS.gov/irb/
box 2a, and any basis recovery amount in box 5. (See the
2013-52_IRB#NOT-2013-74.
instructions for
Box
5, later.) Use Code G in box 7. If the
direct rollover is made on behalf of a nonspouse designated
Designated Roth accounts. A direct rollover from a
beneficiary, also enter Code 4 in box 7.
designated Roth account may only be made to another
For reporting instructions for a direct rollover from a
designated Roth account or to a Roth IRA. A distribution from
designated Roth account, see
Designated Roth
accounts,
a Roth IRA, however, cannot be rolled over into a designated
earlier.
Roth account. In addition, a plan is permitted to treat the
balance of the participant's designated Roth account and the
Explanation to Recipients Before Eligible
participant's other accounts under the plan as accounts held
Rollover Distributions (Section 402(f) Notice)
under two separate plans for purposes of applying the
automatic rollover rules of section 401(a)(31)(B) and Q/A-9
For qualified plans, section 403(b) plans, and governmental
through Q/A-11 of Regulations section 1.401(a)(31)-1. Thus,
section 457(b) plans, the plan administrator must provide to
if a participant's balance in the designated Roth account is
each recipient of an eligible rollover distribution an
less than $200, the plan is not required to offer a direct
explanation using either a written paper document or an
rollover election or to apply the automatic rollover provisions
electronic medium (section 402(f) notice). The explanation
to such balance.
must be provided no more than 180 days and no fewer than
30 days before making an eligible rollover distribution or
A distribution from a designated Roth account that is a
before the annuity starting date. However, if the recipient who
qualified distribution is tax free. A qualified distribution is a
has received the section 402(f) notice affirmatively elects a
payment that is made both after age 59
/
(or after death or
1
2
distribution, you will not fail to satisfy the timing requirements
disabililty) and after the 5-tax-year period that begins with the
merely because you make the distribution fewer than 30 days
first day of the first tax year in which the employee makes a
after you provided the notice as long as you meet the
contribution to the designated Roth account. Certain
requirements of Regulations section 1.402(f)-1, Q/A-2. The
amounts, including corrective distributions, cannot be
electronic section 402(f) notice must meet the requirements
qualified distributions. See Regulations section 1.402A-1.
for using electronic media in Regulations section
If any portion of a distribution from a designated Roth
1.401(a)-21.
account that is not includible in gross income is to be rolled
over into a designated Roth account under another plan, the
The notice must explain the rollover rules, the special tax
rollover must be accomplished by a direct rollover. Any
treatment for certain lump-sum distributions, the direct
portion not includible in gross income that is distributed to the
rollover option (and any default procedures), the mandatory
employee, however, cannot be rolled over to another
20% withholding rules, and an explanation of how
designated Roth account, though it can be rolled over into a
distributions from the plan to which the rollover is made may
Roth IRA within the 60-day period described in section
have different restrictions and tax consequences than the
402(c)(3). In the case of a direct rollover, the distributing plan
plan from which the rollover is made.
is required to report to the recipient plan the amount of the
investment (basis) in the contract and the first year of the
For periodic payments that are eligible rollover
5-tax-year period, or that the distribution is a qualified
distributions, you must provide the notice before the first
distribution.
payment and at least once a year as long as the payments
For a direct rollover of a distribution from a designated
continue. For section 403(b) plans, the payer must provide
Roth account to a Roth IRA, enter the amount rolled over in
an explanation of the direct rollover option within the time
box 1 and 0 (zero) in box 2a. Use Code H in box 7. For all
period described earlier or some other reasonable period of
other distributions from a designated Roth account, use
time.
Code B in box 7, unless Code E applies. If the direct rollover
Notice 2020-62, 2020-35 I.R.B. 476 available at
is from one designated Roth account to another designated
IRS.gov/irb/2020-35_IRB#NOT-2020-62, contains two safe
Roth account, also enter Code G in box 7.
harbor explanations that may be provided to recipients of
For a direct rollover of a distribution from a section 401(k)
eligible rollover distributions from an employer plan in order
plan, a section 403(b) plan, or a governmental section 457(b)
to satisfy section 402(f).
plan to a designated Roth account in the same plan, enter
the amount rolled over in box 1, the taxable amount in
Involuntary distributions. For involuntary distributions paid
box 2a, and any basis recovery amount in box 5. Use Code
to an IRA in a direct rollover (automatic rollover), you may
G in box 7.
satisfy the notification requirements of section 401(a)(31)(B)
(i) either separately or as a part of the section 402(f) notice.
Qualified rollover contributions as defined in section
The notification must be in writing and may be sent using
408A(e). A qualified rollover contribution as defined in
section 408A(e) is:
electronic media in accordance with Q/A-5 of Regulations
section 1.402(f)-1. Also, see
Notice 2005-5,
Q/A-15.
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Instructions for Forms 1099-R and 5498 (2021)