Many clients are calling with questions about tax forms 1099-R and 5498.
Remember, this is not accounting advice and we are unable to provide accounting advice but here is a quick overview of the forms.
What you need to do with the forms:
✅ Check form 1099-R Box 7 for correct distribution type (see below). If Box 7 says Code G, and Box 4 is blank or "0", you were not taxed and you did not pay taxes on this account. This simply means you made a non-taxable rollover from one retirement account (TSP) to your new retirement account (IRA).
✅ Provide 1099-R to your tax preparer.
Things to know:
• Form 1099-R
Shows withdrawals or rollovers you actually took during the tax year. Your tax preparer uses the 1099-R to file your return.
Box 7 explains why the distribution occurred. Common Box 7 codes:
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Code 7 – Normal Distribution: Over age 59½; likely a monthly or annual withdrawal we set up for you and is usually taxable.
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Code 1 – Early Distribution: Under 59½; may be subject to penalty unless retired at age 55 or older.
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Code 2 – Early Distribution, Exception Applies: Under 59½, but no penalty due to an IRS exception (disability, etc.)
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Code 4 – Death: Distribution paid to a beneficiary.
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Code G – Direct Rollover: Moved between retirement accounts; not taxable.
• RMD Letter / Form 5498
You received this form in May 2025 if you rolled money into an IRA. It is for your records only. Your tax preparer does not use this form to file your taxes. If you're age 72 or older and have a Required Minimum Distribution (RMD), Box 12a shows the date it is due and Box 12b shows the RMD amount. It likely will show 12/31/2026 as the date due even though it is for tax year 2025. Remember, RMD amounts usually increase each year as you age so that's why this amount will likely be higher than last year.
If you're taking monthly payments from your IRA, you likely will have met your RMD and no further action is needed. If you’d like us to double-check your RMD, let us know but please be patient as we work through the calls!
