Get ready to file form 5329 with your form 1040

L1: Get ready to file form 5329 with your form 1040There are new instructions for completing a form 1099-R for 2004, and they appear to be different than the previous years instructions, especially on the use of a code 2′ in box 7′.
2Early distribution, exception applies. 8, D, or P
Use Code 2 only if the distribution is:

A Roth IRA conversion (an IRA converted to a Roth IRA) or a reconversion if the participant is under age 591/2,
An early distribution made from a qualified retirement plan or IRA because of an IRS levy under section 6331,
A section 457(b) plan distribution and not subject to the additional 10% tax. But see Section 457(b) plan distributions on page R-8 for these distributions that may be subject to the 10% additional tax, and
A distribution from a qualified retirement plan after separation from service where the taxpayer has reached age 55.
The difference… there is no mention of distributions from a SEPP. Were SEPP distiibutions merely overlooked? Probably not as they were mentioned in several other pages of the instructions.Could this possibly mean that for 2004 (and maybe later) that the exception to the 10% penalty for a SEPP will have to be claimed annually by filing for 5329 with the taxpayer’s form 1040? Sure appears that way.2004-06-24 06:37, By: Gfw, IP: [172.16.1.71]

L2: Get ready to file form 5329 with your form 1040According to my sources, ACLI pointed out the omission to IRS. Apparently the IRS was not intentionally changing the reporting rules and will be issuing a clarification. 2004-07-14 11:56, By: BillE, IP: [206.195.193.10]

L2: Get ready to file form 5329 with your form 1040Actually I’ve heard two sides – one each way – both sides claim to have talked to the IRS. It will be interesting to see if theyissue new instructions. 2004-07-14 12:03, By: Gfw, IP: [172.16.1.73]

L2: Get ready to file form 5329 with your form 1040I just received additional information from ACLI stating that IRS had reversed their decision and should be posting a correction on their website in about a week. I’ll forward you a copy of what I received.2004-07-28 10:25, By: BillE, IP: [206.195.193.10]

L2: Get ready to file form 5329 with your form 1040All,
I just contacted the IRS technical staff and they confirmed the changes to the allowable use of code 2 on the 1099R form was not a mistake. In fact (according to the source I spoke to) it was done to speciffically curb the misuse and/or misunderstanding of the use of code 2 when populating the information on a 1099R form.
As GFW said, Get Ready to File a 5329 form.2004-08-20 09:31, By: CDM, IP: [206.149.201.118]

L2: Get ready to file form 5329 with your form 1040I placed a post in the What’s New section – check out http://www.irs.gov/formspubs/article/0,,id=109875,00.html- the revsed instructions were posted a few weeks ago – lots of preasure for the Life Insurance industry probably made the IRS reconsider. 2004-08-20 09:45, By: Gfw, IP: [172.16.1.70]

L2: Get ready to file form 5329 with your form 1040GFW and all,
My apologies for providing incorrect information in my previous reply; however, I went through 5 tiers of IRS support to get the information and I believed it to be accurate based on the confident response from the IRS source.
However, in this case, I’m glad I was wrong…
CDM2004-08-20 20:27, By: CDM, IP: [206.149.200.31]