Frequently Asked Questions

Form 1099-R

 

What is IRS Form 1099-R?
IRS Form 1099-R is filed for any person to whom a distribution, conversion or recharacterization is made from a traditional, Roth, SEP or SIMPLE Individual Retirement Arrangement (IRA). Other types of retirement accounts/plans, such as 401(k), 403(b), pension and profit sharing, also issue Form 1099-R.

Top of page

Why did I receive a Form 1099-R?
You either received full or partial distributions or direct rollovers or removed excess contributions from your Edward Jones self-directed retirement account, or completed a recharacterization and/or conversion during 2013. Trustee-to-trustee transfers are not considered distributions and therefore are generally not reportable to the IRS.

Top of page

Why did I receive more than one Form 1099-R from Edward Jones?
If you received more than one type of distribution from your IRA or qualified retirement plan, you will receive more than one Form 1099-R. For example, if you turned 59½ during calendar year 2013, you would receive one Form 1099-R reporting any distributions taken before age 59½ (distribution code 1) and another Form 1099-R reporting distributions taken after age 59½ (distribution code 7).  

Top of page

What is reported in Box 2a? Why is Box 2b checked?
Generally, the amount in Box 2a is the taxable amount of your distribution. If there is no entry in Box 2a, Edward Jones may not have all the facts needed to figure the taxable amount. In that case, the first box in Box 2b (Taxable amount not determined) is checked.

Additionally, your distribution may not be taxable due to a rollover, distribution of a nondeductible contribution or other exception. Therefore, the first box in Box 2b (Taxable amount not determined) is checked. If you have nondeductible contributions, please see the instructions for IRS Form 8606.

 Top of page  

How do I report my qualified health savings account funding distribution?
If the distribution was removed from your IRA (other than a SEP or SIMPLE IRA) to directly fund a qualified health savings account (HSA) funding distribution (HFD), the amount will be reported in Box 1 of your 1099-R.

Top of page

My Form 1099-R shows distribution code 1 in Box 7. If this distribution should be exempt from the 10% early withdrawal penalty, what IRS tax form do I use to report the penalty exception? 
See Instructions for IRS Form 5329.

Top of page

If I participate in my employer’s SIMPLE IRA and take a distribution before reaching age 59½, will I pay any penalties?
SIMPLE IRA participants who take distributions before age 59½ owe a penalty unless an exception applies. If you have not been active in the plan for at least two years, the penalty is 25% of the distributed amount in addition to ordinary income tax. For participants who have been in the plan for more than two years, the penalty is 10% of the distribution.

See the Form 5329 instructions for information on calculating the penalty.

Top of page

Why did I receive a 1099-R from a deceased person’s account?
As custodian, Edward Jones is required to report all distributions taken from an account due to death. As a beneficiary taking distributions from a decedent IRA, you will receive a 1099-R reporting the amount withdrawn under distribution code 4.

If you are the spouse beneficiary of a qualified retirement plan and have rolled the assets to your own IRA, you will receive a 1099-R reporting this amount under distribution code G4. For the IRA that received the rollover, you will receive a Form 5498, which is issued in May 2014.

If you are a non-spouse beneficiary of a qualified retirement plan and elected to have your benefits roll over to an inherited IRA (after the original account owner’s death), you will receive a 1099-R reporting that amount under distribution code G4. The rollover received in the IRA will be reported on your 5498, which is issued in May 2014.

Top of page

When I took my distribution, I had income tax withheld. How do I report the withholding?
If federal income tax was withheld, it will be reported in Box 4 of your Form 1099-R. Report this amount on Form 1040, line 62, or on Form 1040A, line 36. Attach Copy B of your Form 1099-R to your income tax return if federal withholding is shown in Box 4.

Top of page

How do I report a recharacterization of a contribution or conversion?
If you recharacterized a contribution or a Roth conversion, the fair market value of the amount transferred will be reported in Box 1 of your Form 1099-R. The distribution code in Box 7 will indicate whether the original contribution or conversion was in the same year or a prior year.

Even if you recharacterized, Edward Jones is still required to report the original contribution or conversion on Form 5498, which is issued in May 2014. Please see the instructions for IRS Form 8606 or consult your tax professional for details on reporting.

Note: The Tax Increase Prevention and Reconciliation Act (TIPRA) repealed Roth eligibility requirements that were in place prior to 2010. This allows individuals, regardless of filing status or income level, to convert to a Roth IRA. It’s important to note that the Roth contribution eligibility limits still apply.

Top of page

Does Form 1099-R report contributions or rollovers?
No. Form 1099-R does not report contributions or rollovers to your retirement account. This activity is reported on Form 5498, which will be sent to you no later than May 31, 2014. You do not need Form 5498 to file your tax return; it is provided for informational purposes only.

Top of page 

Why did I receive a Form 1099-R when I rolled my distribution to an IRA within the 60-day limit?
As custodian, Edward Jones is required to report ALL distributions taken from our clients’ self-directed retirement accounts. Any distributions, even those rolled to an IRA within the 60-day limit, are reported on Form 1099-R.

Top of page

Additional questions? Contact your local financial advisor.

Please note that Edward Jones does not provide tax or legal advice. This interpretation of tax law is a summarization and should not be depended upon for other than broadly informational purposes. Specific questions should be referred to a qualified tax professional.

Over 10,000 offices. Find one near you.
TAX HOTLINE

Our Tax Hotline is available at 800-282-0829 from mid-January through April 30.

  • Home
  • Site Map
  • Feedback
  • Find a Financial Advisor
  • Canada Home
  • Privacy
  • Disclosures
  • AdChoices

Your Opinion Counts

 

Thank you for visiting EdwardJones.com! We'd like to invite you to take a 2-minute survey about your website visit today, to help us make the experience better for you in the future. The survey will open in a new tab, so you won't lose your place on the website.