Form 5329 (2012) Checklist
Purpose and Year-Specific Context
Form 5329 calculates additional taxes on early distributions from IRAs, qualified plans, and tax-favored education and health savings accounts. The 2012 form follows pre-SECURE Act rules, as that legislation did not become law until December 2019.
For 2012, the 10 percent early distribution penalty applies to distributions taken before age 59½ unless an exception applies. The form assesses a 6 percent annual penalty on excess contributions to IRAs, Coverdell ESAs, Archer MSAs, and HSAs. The penalty for failing to take required minimum distributions from qualified plans and IRAs remains 50 percent of the shortfall amount for 2012.
Filing Requirements and Exemptions
You must file Form 5329 if you received an early distribution from a qualified retirement plan before age 59½ and meet an exception to the 10 percent penalty. File the form when the exception does not apply to the entire distribution or when your Form 1099-R does not show the correct exception code in box 7.
You need not file Part I if you report the 10 percent tax directly on Form 1040, line 58, or Form 1040NR, line 56, when distribution code 1 appears correctly on all Forms 1099-R.
File Form 5329 if you contributed more than the allowable amount to your traditional IRAs, Roth IRAs, Coverdell ESAs, Archer MSAs, or HSAs for 2012.
File the form if your 2011 Form 5329 showed a tax due on line 17, 25, 33, 41, or 49 for excess contributions. File Form 5329 if you did not receive the minimum required distribution from your qualified retirement plan for 2012.
Exception Codes for Early Distributions
The following exception numbers apply when reporting distributions on Part I, line 2:
● 01: Qualified retirement plan distributions after separation from service in or after the year you reach age 55, or age 50 for qualified public safety employees. This exception does not apply to IRAs.
● 02: Distributions made as part of substantially equal periodic payments for your life expectancy or the joint life expectancies of you and your designated beneficiary.
● 03: Distributions due to total and permanent disability.
● 04: Distributions due to death. This exception does not apply to modified endowment contracts.
● 05: Qualified retirement plan distributions up to the amount you paid for unreimbursed medical expenses during the year, minus 7.5 percent of your adjusted gross income.
● 06: Qualified retirement plan distributions made to an alternate payee under a qualified domestic relations order. This exception does not apply to IRAs.
● 07: IRA distributions made to unemployed individuals for health insurance premiums.
● 08: IRA distributions made for higher education expenses.
● 09: IRA distributions made for the purchase of a first home, up to a $10,000 lifetime limit. This exception applies to both traditional IRAs and Roth IRAs.
● 10: Distributions due to an IRS levy on the qualified retirement plan.
● 11: Qualified distributions to reservists while serving on active duty for at least 180 days.
● 12: Other exceptions apply, or more than one exception applies to your distribution.
Carryover Amounts from Prior Year
Locate your 2011 Form 5329 to transfer excess contributions to the 2012 form.
● Enter the amount from line 16 of your 2011 Form 5329 on line 9 of your 2012 Form for traditional IRA excess contributions.
● Transfer line 24 from your 2011 form to line 18 of your 2012 Form for Roth IRA excess contributions.
● Enter the amount from line 32 of your 2011 Form 5329 on line 26 of your 2012 Form for Coverdell ESA excess contributions.
● Transfer line 40 from your 2011 form to line 34 of your 2012 Form for Archer MSA excess contributions.
● Enter the amount from line 48 of your 2011 Form 5329 on line 42 of your 2012 Form for HSA excess contributions.
SIMPLE IRA Early Distribution Penalty
Distributions from a SIMPLE IRA face a 25 percent penalty instead of the standard 10 percent penalty when taken within two years from the date you first participated in the SIMPLE IRA plan.
The two-year period begins on the first day a contribution is deposited into your SIMPLE IRA account under that employer's plan. After two years from your first participation date, the standard 10 percent early distribution penalty applies to distributions taken before age 59½ unless you qualify for an exception.
Excess Contribution Calculations
Traditional IRA Excess Contributions
Complete Part III if you contributed more to your traditional IRAs for 2012 than your allowable limit or carried forward excess contributions from 2011. Your contribution limit equals the smaller of $5,000 ($6,000 if age 50 or older at the end of 2012) or your taxable compensation for the year. Enter zero on line 10 unless your 2012 allowable contribution limit exceeded your actual contributions for the year.
The 6 percent penalty applies to the smaller of your total excess contributions or the fair market value of all traditional IRAs on December 31, 2012. Include contributions made in January through April 2013 for tax year 2012 when calculating the fair market value.
Roth IRA Excess Contributions
Complete Part IV if you contributed more to your Roth IRAs for 2012 than your allowable limit or carried forward excess contributions from 2011. Your contribution limit may be reduced or eliminated if your modified adjusted gross income exceeds $173,000 for married filing jointly or $110,000 for single filers. Enter zero on line 19 unless your 2012 allowable contribution limit exceeded your actual contributions.
The 6 percent penalty applies to the smaller of your total excess contributions or the fair market value of all Roth IRAs on December 31, 2012. Include contributions made in early 2013 for the tax year 2012 when calculating the fair market value.
Filing Instructions
Attach Form 5329 to your 2012 Form 1040 or Form 1040NR by the due date, including extensions. File Form 5329 by itself if you do not need to file an income tax return for 2012.
Complete a separate Form 5329 for each spouse when filing jointly if both spouses owe additional taxes.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
