What is this IRS Form 5498 I just received? :: Wamhoff Financial & Accounting


What is this IRS Form 5498 I just received?

Many taxpayers have received the last week of May a Form 5498 and are concerned that they missed reporting this on their 2015 income tax return. Do not fret; your IRA trustee or issuer is required to file this form with the IRS by May 31st. The copy that you received in the mail is for your records.

So what exactly is this Form 5498?

If you have contributed to an IRA you will receive a Form 5498 each year. The institution that manages your IRA is required to report all contributions you make to the account during the year.

The Form 5498 covers a wide variety of IRAs. Box 1 shows the amount you contributed to a traditional IRA; Box 9 reports the amount contributed to a SIMPLE IRA and Box 10 reports the amount contributed to a ROTH IRA.

A rollover or conversion from one retirement plan into an IRA is considered a contribution and therefore will be reported in boxes 2 & 3 on the Form 5498.

The other important reported on the Form 5498 is your required minimum distribution. At age 70 ½ you are required to take a distribution from the account based on the value at the end of the prior year. This form will provide the value and also will provide the required minimum distribution.

Why are they arriving after the tax deadline? You can contribute to an IRA until the due date of your Federal tax return-mid April. Therefore the account administrator prepares the forms after the April 15th deadline.

In closing, you may receive more than one Form 5498 since you can have multiple IRA trustees.